[Federal Register Volume 88, Number 235 (Friday, December 8, 2023)]
[Rules and Regulations]
[Pages 85794-85815]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-26338]



[[Page 85793]]

Vol. 88

Friday,

No. 235

December 8, 2023

Part IV





 Federal Communications Commission





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47 CFR Parts 52 and 64





Protecting Consumers From SIM-Swap and Port-Out Fraud; Final Rule

Federal Register / Vol. 88, No. 235 / Friday, December 8, 2023 / 
Rules and Regulations

[[Page 85794]]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Parts 52 and 64

[WC Docket No. 21-341; FCC 23-95, FR ID 186823]


Protecting Consumers from SIM-Swap and Port-Out Fraud

AGENCY: Federal Communications Commission.

ACTION: Final rule.

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SUMMARY: In this document, the Federal Communications Commission 
adopted a Report and Order that adopts measures designed to address two 
fraudulent practices bad actors use to take control of consumers' cell 
phone accounts and wreak havoc on people's financial and digital lives 
without ever gaining physical control of a consumer's phone. The Report 
and Order revises the Commission's Customer Proprietary Network 
Information (CPNI) and Local Number Portability (LNP) rules to require 
wireless providers to adopt secure methods of authenticating a customer 
before redirecting a customer's phone number to a new device or 
provider. The Report and Order also require wireless providers to 
immediately notify customers whenever a SIM change or port-out request 
is made on customers' accounts, and take additional steps to protect 
customers from SIM swap and port-out fraud.

DATES: Effective January 8, 2024, except for revisions to 47 CFR 
52.37(c), 52.37(d), 52.37(e), 52.37(g) (instruction 3), 64.2010(h)(2), 
64.2010(h)(3), 64.2010(h)(4), 64.2010(h)(5), 64.2010(h)(6), and 
64.2010(h)(8) (instruction 6), which contain information collection 
requirements and are delayed indefinitely. The FCC will publish a 
document in the Federal Register announcing the effective date for 
those Sections.

ADDRESSES: Federal Communications Commission, 45 L Street SW, 
Washington, DC 20554. In addition to filing comments with the Office of 
the Secretary, a copy of any comments on the Paperwork Reduction Act 
information collection requirements contained herein should be 
submitted to Nicole Ongele, Federal Communications Commission, 45 L 
Street SW, Washington, DC 20554, or send an email to <a href="/cdn-cgi/l/email-protection#f5a5a7b4b5939696db929a83"><span class="__cf_email__" data-cfemail="95c5c7d4d5f3f6f6bbf2fae3">[email protected]</span></a>.

FOR FURTHER INFORMATION CONTACT: For further information, contact 
Melissa Kirkel at <a href="/cdn-cgi/l/email-protection#600d050c091313014e0b09120b050c200603034e070f16"><span class="__cf_email__" data-cfemail="7f121a13160c0c1e5114160d141a133f191c1c51181009">[email protected]</span></a>. For additional information 
concerning the Paperwork Reduction Act information collection 
requirements contained in this document, send an email to <a href="/cdn-cgi/l/email-protection#e0b0b2a1a0868383ce878f96"><span class="__cf_email__" data-cfemail="48181a09082e2b2b662f273e">[email protected]</span></a> 
or contact Nicole Ongele, <a href="/cdn-cgi/l/email-protection#e3ad8a808c8f86cdac8d84868f86a3858080cd848c95"><span class="__cf_email__" data-cfemail="88c6e1ebe7e4eda6c7e6efede4edc8eeebeba6efe7fe">[email protected]</span></a>.

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Report 
and Order in WC Docket No. 21-341, FCC 23-95, adopted on November 15, 
2023 and released on November 16, 2023. The full text of the document 
is available on the Commission's website at https://docs.fcc.gov/public/attachments/FCC-23-95A1.pdf. To request materials in accessible 
formats for people with disabilities (e.g. braille, large print, 
electronic files, audio format, etc.), send an email to <a href="/cdn-cgi/l/email-protection#6e282d2d5b5e5a2e080d0d40090118"><span class="__cf_email__" data-cfemail="d0969393e5e0e490b6b3b3feb7bfa6">[email protected]</span></a> 
or call the Consumer & Governmental Affairs Bureau at (202) 418-0530 
(voice).
    Compliance with the rule changes adopted in this Report and Order 
shall not be required until the later of: (i) six months after the 
effective date of this Report and Order; or (ii) after the Office of 
Management and Budget (OMB) completes review of any information 
collection requirements associated with this Report and Order that the 
Wireline Competition Bureau determines is required under the Paperwork 
Reduction Act.

Paperwork Reduction Act of 1995 Analysis

    This document contains new or modified information collection 
requirements. The Commission, as part of its continuing effort to 
reduce paperwork burdens, will invite the general public to comment on 
the information collection requirements contained in this Report and 
Order as required by the Paperwork Reduction Act of 1995, Public Law 
104-13. In addition, the Commission notes that pursuant to the Small 
Business Paperwork Relief Act of 2002, Public Law 107-198, see 44 
U.S.C. 3506(c)(4), we previously sought specific comment on how the 
Commission might further reduce the information collection burden for 
small business concerns with fewer than 25 employees.
    In this Report and Order, we have assessed the effects of required 
customer notifications and notices, and related recordkeeping 
requirements, to protect customers from SIM swap and port-out fraud, 
and find that they do not place a significant burden on small 
businesses. Although no commenters specifically addressed whether such 
requirements may place burdens on small wireless providers, we note 
that CCA advised the Commission to ``keep in mind the constraints with 
which many small carriers operate against in adopting security 
measures,'' asserting that any rules ``should allow carriers to use 
technologies that are reasonably available and have choice in the 
approach to take in authenticating their customers.'' As a general 
matter, the baseline, flexible rules we adopt reflect our recognition 
that, in some cases, strict prescriptive requirements to prevent SIM 
swap and port-out fraud could be technically and economically 
infeasible for wireless providers to implement, particularly for 
smaller providers. We emphasize that the record shows that many 
wireless providers already have in place some of the policies and 
procedures we adopt today and that our rules may therefore only require 
them to adapt, refine, or consistently apply those existing practices. 
Additionally, by setting baseline requirements and giving wireless 
providers flexibility on how to meet them, we allow providers to adopt 
the most cost-effective and least burdensome solutions to achieve the 
level of security needed to protect customers against SIM swap and 
port-out fraud in a given circumstance. We have further minimized the 
potential burdens of customer notifications by declining to prescribe 
particular content and wording and giving wireless providers 
flexibility on how to deliver such notifications. Similarly, for 
customer notices, we declined to require a specific format and content, 
and we declined to require such notices be delivered to customers 
annually. Further, we mitigated potential burdens of the recordkeeping 
requirement by declining to require that wireless providers include 
historic data in their recordkeeping, which we acknowledged would be 
particularly burdensome for small providers, and declining to require 
that providers report this data to the Commission regularly.

Congressional Review Act

    The Commission has determined, and the Administrator of the Office 
of Information and Regulatory Affairs, Office of Management and Budget, 
concurs, that this rule is non-major under the Congressional Review 
Act, 5 U.S.C. 804(2). The Commission will send a copy of this Report 
and Order to Congress and the Government Accountability Office pursuant 
to 5 U.S.C. 801(a)(1)(A).

I. Synopsis

    1. Today we revise our CPNI and LNP rules to provide greater 
protection to customers from SIM swap and port-out fraud. The 
cornerstone of our action is a requirement that wireless providers use 
secure methods of authenticating customers prior to performing SIM 
changes and number ports. Other rules

[[Page 85795]]

we adopt reinforce that requirement, including that wireless providers 
adopt processes for responding to failed authentication attempts, 
institute employee training for handling SIM swap and port-out fraud, 
and establish safeguards to prevent employees who interact with 
customers from accessing CPNI until after customers have been 
authenticated. We also adopt rules that will enable customers to act to 
prevent and address fraudulent SIM changes and number ports, including 
requiring that wireless providers notify customers regarding SIM change 
and port-out requests, offer customers the option to lock their 
accounts to block processing of SIM changes and number ports, and give 
advanced notice of available account protection mechanisms. We further 
establish requirements to minimize the harms of SIM swap and port-out 
fraud when it occurs, including requiring wireless providers to 
maintain a clear process for customers to report fraud, promptly 
investigate and remediate fraud, and promptly provide customers with 
documentation of fraud involving their accounts. Finally, to ensure 
wireless providers track the effectiveness of authentication measures 
used for SIM change requests, we require that they keep records of SIM 
change requests and the authentication measures they use.
    2. In adopting these rules, we balance the need to protect 
customers from the harms of SIM swap and port-out fraud with the goal 
of preserving the relative ease with which customers can obtain 
legitimate SIM changes and number ports. The record reflects that the 
vast majority of SIM change and port-out requests are legitimate. It 
also shows that the efficient and effective processing of SIM changes 
and port-out requests promotes customer choice and competition and 
prevents interruptions in access to wireless services that are vital to 
customers' everyday lives. Service interruptions can be particularly 
problematic when they hamper the ability of customers to access 
emergency services. We agree with the Competitive Carriers Association 
(CCA) that ``enhanced requirements for SIM swap and port-out requests 
can implicate the customer experience and can intentionally or 
unintentionally serve as impediments to legitimate requests to change 
devices or change providers.'' We are wary of setting rigid 
requirements that would impose significant burdens on customers without 
substantially protecting against SIM swap and port-out fraud. We also 
recognize that prescribing particular security methods can place 
greater burdens on some customers because of their technical and 
financial means, digital literacy, accessibility needs, and other 
particularized circumstances. We anticipate that the approach we take 
today will provide meaningful protection to customers while preserving 
the competition and customer choice that SIM changes and number porting 
are meant to facilitate and avoiding undue burdens that hinder access 
to wireless services.
    3. To that end, we set baseline rules, rather than prescriptive 
requirements, that establish a uniform framework across the mobile 
wireless industry for the types of policies and procedures providers 
must employ to combat SIM swap and port-out fraud. The record indicates 
that several wireless providers already rely, at least partly, on some 
of these policies and procedures. We are concerned, however, that a 
lack of consistency in how wireless providers apply these measures and 
a lack of uniformity in the use of these measures industry-wide leaves 
some customers vulnerable to SIM swap and port-out fraud. The rules we 
adopt ensure that all wireless providers are taking consistent and 
comprehensive steps to address this fraud. For wireless providers that 
already employ the measures we require, in many cases our rules simply 
raise the bar by requiring them to adapt, refine, or consistently apply 
those existing practices. For wireless providers that do not, our new 
rules require them to implement new practices to meet the baseline 
standards. We anticipate that our approach will ensure that customers 
receive effective protection from SIM swap and port-out fraud 
regardless of the wireless telecommunications services they purchase or 
the wireless provider from whom they purchase them.
    4. In setting baseline requirements, rather than prescriptive 
rules, our approach also gives wireless providers the flexibility to 
establish the specific fraud protection measures they use so that they 
can deliver the most advanced protections available. The record 
provides substantial evidence that to best combat SIM swap and port-out 
fraud, wireless providers need flexibility. In particular, we are 
persuaded that wireless providers need such flexibility so that they 
can adapt their security methods to keep pace with the evolving threat 
landscape. Verizon notes that ``fraudsters are sophisticated and 
constantly look to circumvent any protections, no matter how robust.'' 
We also recognize that ``[r]apid technological changes introduce new 
vulnerabilities that existing rules may be unequipped to address.'' We 
are therefore concerned by record evidence that a static set of 
prescriptive requirements may incentivize some wireless providers to 
rely exclusively on those security methods and discourage them from 
innovating and adopting new and improved practices to address evolving 
fraud techniques used by bad actors. We also share concerns that 
setting specific requirements could either provide a roadmap for bad 
actors seeking to commit fraud or lock in measures that quickly prove 
to be ineffective or obsolete. The aim of our action today is to better 
protect telecommunications customers from fraudulent schemes; in doing 
so, it is important that our rules, while functioning as baseline 
safeguards, do not serve as obstacles to adoption of better security 
practices. Indeed, the record asserts that establishing rules that 
provide flexibility will incentivize wireless providers to develop and 
adopt new and improved methods to protect against SIM swap and port-out 
fraud and enable them to quickly adapt their security measures to 
respond to evolving techniques and technologies used by bad actors. 
Accordingly, we agree with AT&T that ``[t]he best way to combat ever-
evolving fraud tactics is to allow industry players the ability to 
adapt and respond to these changing threats in real-time,'' and we 
afford wireless providers this flexibility with the rules we adopt in 
this Report and Order.
    5. Flexibility will also permit wireless providers to use the 
specific security practices that are effective and appropriate under 
the circumstances. We are persuaded that any given measure will rarely 
prove foolproof, necessary, or suitable in all instances, and therefore 
that wireless providers should have the ability to tailor the security 
mechanisms they use. AT&T, for instance, asserts that it has had 
success in deploying measures strategically to reduce the incidents of 
SIM swap and port-out fraud, and with our rules, we seek to foster such 
outcomes. Our flexible approach enables wireless providers to implement 
security measures that are designed to address a customer's particular 
circumstances and preferences, and also allows wireless providers to 
implement measures that are best suited for their business models, 
technologies, and the services they offer. We also recognize that some 
wireless providers may seek to use a risk-based model, whereby they 
apply different mechanisms to protect customers based on the likelihood 
of fraud for a particular SIM change or port-out request, and we do not 
want to

[[Page 85796]]

hinder these targeted efforts. For these reasons, we conclude that 
wireless providers should have the flexibility to determine which 
specific measure will be most effective at protecting customers against 
SIM swap and port-out fraud in a given circumstance in accordance with 
our baseline rules.
    6. We further anticipate that our flexible approach will enhance 
protections for customers without placing undue costs and burdens on 
wireless providers. We are cognizant that in some instances, strict 
prescriptive requirements to prevent SIM swap and port-out fraud could 
be technically and economically infeasible for wireless providers to 
implement, particularly for smaller providers. Even in the instances 
when wireless providers do have the means to implement prescriptive 
requirements, those requirements could prove burdensome on providers if 
they become obsolete or ineffective and providers are compelled to 
maintain them alongside new and better practices they adopt to address 
the evolving threat landscape. By setting baseline requirements and 
giving wireless providers flexibility on how to meet them, we allow 
providers to adopt the most cost-effective and least burdensome 
solutions to achieve the level of security needed to protect customers 
against SIM swap and port-out fraud in a given circumstance. 
Additionally, because many of our rules build on existing mechanisms 
that many wireless providers already use, we expect that our new rules 
will further minimize the costs and burdens for those providers.

A. Strengthening the Commission's CPNI Rules To Protect Consumers

    7. In this section, we adopt baseline measures designed to reduce 
the incidence of SIM swap fraud without impinging on customers' ability 
to upgrade and replace their devices. As proposed in the SIM Swap and 
Port-Out Fraud Notice, we require wireless providers to use secure 
methods to authenticate customers that are reasonably designed to 
confirm a customer's identity prior to effectuating SIM changes, but we 
depart from our proposal specifying particular methods of 
authentication, to allow providers the flexibility they need to 
implement the most modern and effective authentication methods on an 
ongoing basis. We also adopt rules to require wireless providers to 
implement procedures to address failed authentication attempts and to 
notify customers of SIM change requests prior to effectuating a SIM 
change. Additionally, we adopt rules that allow customers to lock their 
accounts to prevent SIM changes, require wireless providers to track 
the effectiveness of the authentication measures they have implemented, 
and safeguard against employee access to CPNI prior to authentication. 
In each instance, we afford wireless providers needed flexibility while 
enhancing protections for customers.
    8. The record makes clear that because SIMs are only used to 
facilitate service for mobile wireless devices, SIM swap fraud is a 
practice that is exclusive to mobile wireless services. Thus, we apply 
these new requirements to providers of commercial mobile radio service 
(CMRS), as defined in Section 20.3 of Title 47 of the Code of Federal 
Regulations, including resellers of CMRS. We apply these new 
requirements to all SIM changes that wireless providers perform. 
Further, we require wireless providers to implement these rules with 
respect to customers of both pre-paid and post-paid services, 
consistent with the protections afforded by Section 222. We see no 
reason why the protections should not apply to all customers of CMRS, 
including customers of resellers, particularly considering indications 
in the record that pre-paid customers are disproportionately impacted 
by fraud and that many customers impacted by such fraud are low-income 
customers who can ill afford such losses. Under this definition, our 
new rules apply to both facilities-based wireless providers as well as 
resellers of wireless services. Additionally, given that Section 
332(c)(1)(A) of the Act requires that providers of commercial mobile 
service be treated as common carriers, 47 U.S.C. 332(c)(1)(A), our 
rules cover ``any officer, agent, or other person acting for or 
employed by any common carrier or user, acting within the scope of his 
employment.'' We make clear, however, that the rules we adopt today do 
not require providers to collect more information about pre-paid 
customers than they otherwise do in the normal course of business, nor 
should they be interpreted to impose disparate burdens on pre-paid 
customers related to information collection or authentication.
1. Customer Authentication Requirements
    9. We update our CPNI rules to protect customers from the risk of 
fraudulent SIM swaps by requiring wireless providers, prior to 
conducting a SIM change, to use secure methods to authenticate a 
customer that are reasonably designed to confirm a customer's identity, 
except to the extent otherwise required by the Safe Connections Act or 
the Commission's rules implementing that statute. We define ``SIM,'' 
for purposes of these rules, as ``a physical or virtual card associated 
with a device that stores unique information that can be identified to 
a specific mobile network.'' The record reflects significant support 
for strengthening authentication requirements for SIM change requests, 
and we find that the requirement we adopt today most appropriately 
balances the need to increase protection for customers from these types 
of fraudulent schemes while providing wireless providers the 
flexibility the record shows they need to respond to new and emerging 
threats. We encourage wireless providers to use secure authentication 
methods that accommodate the needs of the broad spectrum of customers 
they may serve. We are persuaded by commenters that a general security 
authentication standard will afford customers the highest level of 
protection by allowing wireless providers to implement the 
authentication methods raised in the record, or develop new 
authentication methods, in ways that both account for advances in the 
technology and tactics used by bad actors and that work best for their 
customers and the particular services they offer. Additionally, we 
believe this flexibility alleviates record concerns about the limited 
information wireless providers may have to authenticate customers of 
pre-paid accounts.
    10. The Safe Connections Act of 2022, Public Law 117-223, 136 Stat. 
2280 (Safe Connections Act), which is codified at 47 U.S.C. 345, 
requires wireless providers to separate lines from a multi-line account 
upon request of a survivor of domestic violence and other related 
crimes and abuses. 47 U.S.C. 345(b)(1). In an Order adopted today 
implementing the Safe Connections Act, the Commission adopted rules to 
require covered providers to attempt to authenticate, using multiple 
authentication methods if necessary, that a survivor requesting a line 
separation is a user of a specific line or lines. Covered providers 
must use methods that are reasonably designed to confirm the survivor 
is actually a user of the specified line(s) on the account when the 
survivor is not the primary account holder or a designated user, and 
this authentication shall be sufficient for requesting a SIM change 
when made in connection with a line separation request. To the extent 
this requirement differs from other authentication

[[Page 85797]]

requirements, including those in 47 CFR 64.2010, the line separation 
authentication requirements the Commission adopts to implement 47 
U.S.C. 345 serve as an exception to those other requirements. We also 
make clear that the Safe Connections Act-related exceptions to our new 
SIM change and LNP rules for any SIM change or port-out requests made 
in connection with a legitimate line separation request apply 
regardless of whether a line separation request is technically or 
operationally infeasible.
    11. While the approach we take today gives wireless providers the 
flexibility to adapt to evolving threats, it also creates an obligation 
that they adapt to those threats. Specifically, our rule establishes a 
requirement that wireless providers regularly, but not less than 
annually, review and, as necessary, update their customer 
authentication methods to ensure those methods continue to be secure. 
The record reflects that while many authentication measures may be 
effective today, evolving tactics may mean those methods will not work 
tomorrow or in all circumstances. If wireless providers fail to evolve 
their authentication methods over time, we expect their methods 
eventually will become ineffective. Therefore, we require wireless 
providers to regularly, but not less than annually, review their 
authentication methods, and update them as necessary to ensure that the 
authentication methods remain effective.
    12. Because we impose a general requirement for secure and 
reasonably designed customer authentication, both permitting and 
obligating wireless providers to design effective methods to 
authenticate customers, we decline to enumerate the four specific 
authentication methods the Commission specified in the SIM Swap and 
Port-Out Fraud Notice as those that would meet the standard of secure 
authentication methods. Those four methods were: (i) the use of a pre-
established password; (ii) a one-time passcode sent via text message to 
the account phone number or a pre-registered backup number; (iii) a 
one-time passcode sent via email to the email address associated with 
the account; or (iv) a passcode sent using a voice call to the account 
phone number or a preregistered back-up telephone number. No commenters 
supported our imposing these as the exclusive forms of authentication. 
We are convinced by the record that specifying approved authentication 
methods may incentivize wireless providers to rely exclusively on those 
methods or discourage them from adopting new methods to address 
evolving techniques used by bad actors. Further, some commenters assert 
that requiring specific authentication methods would be burdensome for 
wireless providers. Additionally, the record reflects that setting 
specific authentication methods could provide a roadmap for bad actors 
seeking to commit fraud. The record also highlights potential 
vulnerabilities of the four authentication methods we proposed, which 
counsels against us codifying these as secure methods of authentication 
in perpetuity. For these reasons, we conclude it is most appropriate to 
allow wireless providers to analyze and implement the most effective 
and secure methods of authenticating customers requesting a SIM change. 
For similar reasons, we also decline to require carriers to comply with 
the National Institute of Standards and Technology (NIST) Digital 
Identity Guidelines or other standards proposed in the record.
    13. We nevertheless place boundaries on the use of certain 
information for customer authentication for SIM change requests in 
light of evidence in the record of their particular vulnerability. 
Namely, we conclude, consistent with our proposal, that methods of 
authentication that use readily available biographical information, 
account information, recent payment information, and call detail 
information do not constitute secure methods of authentication. We 
decline to establish an exigent circumstances exception on the use of 
this information for authentication for when customers are traveling 
and may not have access to or remember a PIN, as CTIA asked us to 
consider. We believe that such an exception would establish a 
significant loophole for fraudulent activity and note that in these 
circumstances, customers can use alternative methods of authentication, 
such as email. We strongly encourage providers to work with customers 
to develop backup authentication practices for use in these types of 
scenarios. We seek comment in the Further Notice on whether we should 
harmonize our CPNI rules with the SIM change rules we adopt today, and 
we therefore take no action, at this time, to amend our existing rules 
to prohibit providers from relying on recent payment and call detail 
information to authenticate customers for online, telephone, or in-
person access to CPNI.
    14. We decline to restrict the use of SMS-based customer 
authentication for SIM change requests, but we strongly encourage 
wireless providers to use this mechanism only when paired with other 
secure methods of authentication, i.e., as part of multi-factor 
authentication (MFA). In the SIM Swap and Port-Out Fraud Notice, we 
sought comment on the potential security vulnerabilities of SMS-based 
authentication. The record clearly expresses concern about the security 
risks of SMS-based authentication when used by third parties, such as 
financial institutions, largely because this authentication method 
becomes vulnerable following fraudulent SIM swaps. The record evidence 
is less clear that SMS-based authentication is an insecure mechanism in 
every instance it is used, such as to authenticate the identity of 
individuals requesting a SIM change, particularly when sent over a 
provider's own network, rather than the Public Switched Telephone 
Network (PSTN). We also acknowledge that, in some instances, it may be 
the most practical means a provider can authenticate a customer, 
particularly when considering the needs of a particular customer. We 
anticipate that the approach we take here strikes the right balance 
between protecting customers against SIM swap fraud while preserving 
the relative ease with which customers can obtain legitimate SIM 
changes. We emphasize, however, that our rules create an ongoing 
obligation that wireless providers ensure the authentication methods 
they use are secure. Accordingly, permitting wireless providers to use 
SMS-based authentication does not create a safe harbor for use of this 
authentication method. We will continue to monitor the use of SMS-based 
authentication and may later revisit our decision to permit its 
continued use.
2. Response to Failed Authentication Attempts
    15. We require wireless providers to develop, maintain, and 
implement procedures for responding to failed authentication attempts 
in connection with a SIM change request that are reasonably designed to 
prevent unauthorized access to a customer's account, which, among other 
things, take into consideration the needs of survivors pursuant to the 
Safe Connections Act and our implementing rules. We are bolstered by 
the Princeton University researchers who found evidence that wireless 
providers' procedures to respond to suspicious authentication attempts 
may be inadequate or nonexistent. Specifically, they determined that 
some wireless providers only required callers to successfully respond 
to one authentication challenge to obtain a SIM change even if the 
caller had failed numerous previous authentication attempts. While the 
SIM Swap and Port-

[[Page 85798]]

Out Fraud Notice raised these issues, no commenters offered evidence to 
counter the researchers' findings. Without procedures in place to 
respond to failed authentication attempts, bad actors can seek to 
circumvent wireless provider authentication mechanisms to fraudulently 
obtain a SIM change. We anticipate that requiring wireless providers to 
establish procedures to respond to failed authentication attempts that 
are reasonably designed to prevent unauthorized access to a customer's 
account will impede these fraud attempts. We conclude that whatever 
burdens may be associated with this requirement are outweighed by the 
Commission's interest in protecting customers against fraudulent 
activity.
    16. At the same time, we are persuaded by T-Mobile's argument that 
wireless providers need flexibility with respect to failed 
authentication attempts because it is common for customers to lose or 
forget their authentication data, leading to multiple failed attempts. 
As such, we decline at this time to adopt prescriptive requirements for 
how wireless providers must respond to failed authentication attempts 
in connection with a SIM change request. We find that anchoring this 
rule in a reasonableness standard will give wireless providers 
flexibility to design procedures to handle failed authentication 
attempts that protect against fraudulent activity while preventing 
unnecessary burdens on legitimate customer activity. We decline, 
however, to adopt CTIA's suggestion to require the development and 
implementation of such procedures only where a wireless provider has 
reason to believe multiple authentication attempts are fraudulent; CTIA 
does not address how such determinations would be made absent the very 
procedures we require.
    17. We decline, at this time, to adopt a requirement that wireless 
providers immediately notify customers in the event of multiple failed 
authentication attempts in connection with SIM change requests. 
Industry commenters assert that ``in many cases, providers will not be 
able to discern whether a failed authentication attempt is `in 
connection with a SIM change request' or some other type of transaction 
involving account access for which authentication is needed and 
fails,'' and that ``a carrier does not typically know why a customer 
authenticates until after the customer has successfully 
authenticated.'' Further, commenters raise concerns that tracking such 
attempts across platforms could be technically challenging, though we 
are not persuaded that doing so is technically infeasible. For example, 
CTIA's proposal that carriers should only be required to develop and 
implement procedures for responding to multiple failed authentication 
attempts ``where a carrier has reason to believe such attempts are 
fraudulent'' implies that wireless carriers can and do track multiple 
authentication attempts, or, at a minimum, are technically capable of 
doing so. Given these concerns, we find that requiring wireless 
providers to notify customers immediately of multiple failed 
authentication attempts associated with a SIM change request is not 
appropriate at this time. However, we seek comment in the Further 
Notice below whether we should require wireless providers, or all 
telecommunications carriers, to notify customers immediately of all 
failed authentication attempts to help protect customers from account 
fraud, as well as how wireless providers could implement a customer 
notice requirement for multiple failed authentication attempts.
    18. We also decline to require that wireless providers delay SIM 
changes for 24 hours in the event of failed authentication attempts 
while notifying customers via text message and/or email regarding the 
failed authentication attempts. The record reflects that strict 
requirements involving 24-hour delays or account locks could be overly 
burdensome for customers that are engaged in legitimate SIM changes. We 
also anticipate that the requirement to develop, maintain, and 
implement procedures for responding to failed authentication attempts 
in connection with a SIM change request that are reasonably designed to 
prevent unauthorized access to a customer's account, coupled with the 
requirement we adopt below that wireless providers immediately notify 
customers upon receiving a SIM change request, will be sufficient to 
empower customers to quickly address unauthorized SIM change attempts.
3. Customer Notification of SIM Change Requests
    19. To provide customers with an early warning that their account 
may be subject to fraudulent activity, we adopt our proposal to require 
wireless providers to provide immediate notification to customers of 
any requests for a SIM change associated with the customer's account 
and specify that the notification must be sent before a wireless 
provider effectuates a SIM change, except to the extent otherwise 
required by the Safe Connections Act of 2022 (47 U.S.C. 345) the 
Commission's rules implementing that statute. The record evinces firm 
support for this requirement and provides good reason--time is often of 
the essence with SIM swap fraud, and notifying customers of a SIM 
change request before effectuating the request will enable customers to 
act promptly to mitigate damages and inconvenience resulting from 
fraudulent or inadvertent SIM changes. We also expect that requiring 
notification before the request is processed will prevent the 
notification from being sent to the bad actor after a SIM swap has 
occurred. For these reasons, we agree with Princeton University that 
``[t]here is an unambiguous and material security upside,'' to 
immediate customer notification of SIM change requests, and ``the only 
downside is a very infrequent notification that the customer can easily 
discard'' for legitimate requests.
    20. We therefore disagree with AT&T's contention that notification 
of all SIM change requests is unnecessary because ``AT&T employs 
various tools to assess the risk level of a particular postpaid SIM 
change or port-out request and very often can determine at the outset 
that a request is legitimate.'' The notification requirement we adopt 
today will provide a uniform safety measure for all requests across the 
mobile wireless industry, which we anticipate will reduce the instances 
and mitigate the harms of SIM swap fraud. We also disagree with AT&T's 
assertion that customers will become so inundated with SIM change 
notifications that they will ``eventually become numb or immune to them 
or tire of and consciously choose to ignore them, thus undermining all 
value they might otherwise have when the threat of fraud is real.'' 
Nothing in the record, or our understanding of the SIM change process, 
supports the notion that customers request SIM changes at such a rate 
that, upon the adoption of this rule, wireless providers will be forced 
to inundate their customers with the required notifications. For the 
same reasons, we decline AT&T's request that we modify the mandatory 
SIM change request notification requirement ``either to (1) standalone 
SIM transactions--i.e., SIM swaps that do not include a device change 
or upgrade--based on the lower propensity for fraud in transactions 
involving new devices, or (2) SIM transactions that a carrier 
identifies as having a high propensity for fraud,'' on the basis such 
notifications could cause customer confusion, concern, and fatigue, and 
could increase costs for carriers because such notifications increase 
customer calls.
    21. Also contrary to AT&T's assertions, we do not anticipate that 
the notification requirement we adopt today

[[Page 85799]]

will be overly burdensome for wireless providers to implement. As an 
initial matter, wireless providers should already have processes in 
place to immediately notify customers of certain account changes 
involving CPNI in accordance with our existing rules, so they should be 
able to build on these processes to provide immediate notification 
regarding SIM change requests. The record also demonstrates that some 
wireless providers already notify customers of SIM change requests in 
most instances and therefore will only need to update their processes 
to notify customers in all cases. Additionally, as discussed below, we 
give wireless providers flexibility on how to provide the required 
notifications, which we expect further minimizes any potential burdens 
associated with our new rule. For the same reasons, we decline CTIA's 
request ``to let providers determine whether a notice is warranted or 
effective in the first instance'' on the basis that such flexibility is 
needed to deal with instances, for example, when a phone is lost or 
stolen and expedient forms of notification may not be available. We do 
not prohibit wireless providers from processing SIM change requests 
after the notification is sent, and because bad actors may attempt to 
commit SIM swap fraud by claiming that a device is lost or stolen, that 
is precisely the type of situation when we want to ensure customers are 
provided a notification of a SIM change request. In any event, we find 
that the benefits of our notification requirement outweigh the 
potential burdens.
    22. We permit wireless providers to determine the method of 
providing notifications regarding SIM change requests involving a 
customer's account, but specify that the notifications must be 
reasonably designed to reach the customer associated with the account, 
and sent in accordance with customer preferences, if indicated. For 
example, this would include delivering a notification in the language 
of the customer's choosing, if the wireless provider permits 
communications preferences in other languages and the customer has 
previously indicated such choice. Although some commenters suggest that 
we should specify the means by which a wireless provider should deliver 
SIM change request notifications, we agree with industry commenters 
that providers need flexibility to determine the most appropriate 
method to notify their customers of a pending SIM change request, so 
that providers can account for ``the complexities of notifications in 
various contexts,'' as well as the technical capabilities, 
accessibility needs, or broadband access of individual customers. For 
example, when a customer is requesting a SIM change because the 
customer's phone is lost or stolen, our flexible approach enables 
wireless providers to use methods of notification that are most likely 
to reach the customer under those circumstances, such as an email or a 
text or call to a pre-determined back-up phone number. We also aim to 
enable wireless providers to send notifications in accordance with 
customer preferences, needs, and established expectations. As such, we 
permit wireless providers to use existing methods of notification that 
are reasonably designed to reach the customer associated with the 
account, and we encourage them to adopt new notification methods as 
they are developed to stay responsive to evolving fraud schemes. Such 
methods include, but are not limited to, live or automated telephone 
calls, text messages, emails, or push notification through wireless 
provider software applications. We acknowledge that our new rule 
differs from our existing rule that providers deliver notification of 
other account changes involving CPNI, which specifies that those 
notifications may be delivered through a carrier-originated voicemail 
or text message to the telephone number of record, or by mail to the 
address of record. We find that departing from the existing rule's 
approach is appropriate given the depth of harm that can occur from SIM 
swap fraud, the need for wireless providers to be able to choose the 
most effective method of quickly alerting customers so that customers 
can take action to mitigate harm, and the importance of providers 
adopting new forms of notification.
    23. Our rule also gives carriers the flexibility to design a 
notification process that accommodates scenarios beyond individual 
customers, such as a business customer seeking bulk SIM changes to 
upgrade their equipment. We note that nothing in the customer safeguard 
rules we adopt today is inconsistent with or intended to supersede the 
Commission's existing business customer exemption, which permits 
telecommunications carriers to ``bind themselves contractually to 
authentications regimes other than those described in this section for 
services they provide to their business customers that have both a 
dedicated account representative and a contract that specifically 
addresses the carriers' protection of CPNI.''
    24. We also decline to prescribe particular content or wording of 
SIM change notifications, recognizing that wireless providers are in 
the best position to determine what will most effectively notify 
customers of SIM change requests and potential fraud and will need to 
tailor notifications to customers' service plans and circumstances. 
Nevertheless, consistent with the record and our CPNI rules, we specify 
that such notifications must use clear and concise language that 
provides sufficient information to effectively inform a customer that a 
SIM change request involving the customer's SIM was made. We observe 
that our rule does not prohibit wireless providers from using different 
content and wording for notifications depending on a provider's risk 
assessment of a given SIM change request, so long as the notification 
uses clear and concise language and is reasonably designed to reach the 
actual customer.
    25. We further decline to require a delay for customer verification 
or acknowledgement in connection with notifications prior to completing 
a SIM change request. In the SIM Swap and Port-Out Fraud Notice, we 
sought comment on whether we should require a 24-hour delay (or other 
period of time) before a wireless provider effectuates a SIM change 
while notifying the customer via text message, email, the provider's 
app, or push notification, and requesting verification of the request. 
This approach received minimal support in the record, and we are 
convinced by other record evidence that the burdens of delay and 
verification requirements outweigh the benefits, particularly given how 
regularly customers seek legitimate SIM changes. For instance, CTIA 
explains that a blanket delay would ``make it exceedingly difficult for 
a consumer to obtain a new phone and continued service when a device 
breaks or is lost, representing a full day where that consumer could 
not rely on their wireless service for . . . `keeping in touch with 
friends through voice calls and text messages' [and] placing life-
saving public safety calls.'' AT&T and T-Mobile echoed these concerns. 
We also anticipate that the authentication, notification, and 
remediation requirements we adopt today will sufficiently mitigate 
fraudulent SIM change requests without the need for a burdensome delay 
and verification process. While we do not require wireless providers to 
implement a delay and verification process, we permit them to do so in 
instances when they determine these measures are necessary

[[Page 85800]]

to protect against fraud, but stress that this process should not be 
used to delay legitimate SIM change requests.
4. Account Locks for SIM Changes
    26. We require wireless providers to offer all customers, at no 
cost, the option to lock or freeze their account to stop SIM changes. 
We anticipate that this requirement will provide customers with more 
consistent and meaningful protection against SIM swap fraud, and this 
expectation is supported by the record, which reflects that account 
locks can be powerful tools against SIM swap fraud, particularly for 
customers that are at high-risk of being a target of the practice. We 
adopt our proposal that account locks must be offered to all customers 
at no cost because we find that a customer's financial means should not 
dictate their access to this enhanced security measure, particularly 
since customers with lesser financial means may suffer the greatest 
consequences of SIM swap fraud. This requirement is consistent with 
other Commission rules governing preferred carrier freezes for Local 
Exchange Carriers, see 47 CFR 64.1190, as well as the requirements 
adopted for port-out locks. To simplify the ability for customers to 
take advantage of account locks for SIM changes and number ports, we 
encourage wireless carriers to offer customers the ability to activate 
both locks in one step.
    27. Like the other rules we adopt today, we give wireless providers 
flexibility on how to comply with this measure. In particular, the 
record does not evince a need for us to prescribe a method or methods 
for customers to unlock their accounts or impose a waiting period 
before an unlocked account can be transferred, and as such, we decline 
to do so at this time. We do require, however, that the process to 
activate and deactivate an account lock must not be unduly burdensome 
for customers such that it effectively inhibits them from implementing 
their choice. Additionally, we stress that when activated, wireless 
providers must not fulfill SIM change requests until the customer 
deactivates the lock, except to the extent otherwise required by the 
Safe Connections Act or the Commission's rules implementing that 
statute. We find that the account lock requirement is technically 
feasible, particularly given evidence that some wireless providers 
already offer this feature to customers. Additionally, we are 
unpersuaded by AT&T's claim that ``building a system that is capable of 
widespread adoption of [account locks] would entail significant carrier 
costs and time for questionable gain.'' We anticipate that because of 
these existing account lock offerings and the flexible approach we 
take, the rule will not be unduly costly for wireless providers to 
implement, and that to the extent there are costs associated with the 
requirement, they are outweighed by the associated benefits of 
preventing fraudulent activity.
    28. Consistent with this flexible approach, we permit wireless 
providers to proactively initiate a SIM swap lock on a customer's 
account when a provider believes the customer may be at high risk of 
fraud. We are persuaded by T-Mobile's assertion that such capability is 
valuable because wireless providers are sometimes positioned to know 
when a customer is at high risk of SIM swap fraud and that this tool 
allows them to help customers secure their accounts. However, we 
require that wireless providers promptly provide clear notification to 
the customer that the lock has been activated with instructions on how 
the customer can deactivate the account lock if the customer chooses, 
and to promptly comply with the customer's legitimate request to 
deactivate the account lock. We also caution wireless providers that 
any proactive initiation of a SIM change lock must be limited in 
duration and extend only so long as the high risk of fraud is evident 
to the provider. In establishing this limitation, we intend to prohibit 
wireless provider abuse of SIM change locks to avoid, among other 
outcomes, preventing the customer from terminating service with the 
provider or moving to another competing provider.
    29. Given the protection that account locks can provide to 
customers, we conclude that it should be offered to customers of both 
pre-paid and post-paid services. We are unpersuaded by AT&T's assertion 
that pre-paid service is not amenable to account locks because ``[s]ome 
prepaid customers provide little personal information when they 
activate their account,'' which could make it difficult to authenticate 
a customer to unlock an account. Because the account lock is an 
optional security measure for customers, wireless providers can, if 
necessary, require customers to provide information to use for 
authentication purposes to activate the account lock.
    30. We also disagree with AT&T that an account lock option ``should 
remain a tool that carriers can choose, but are not required, to 
offer.'' AT&T acknowledges that ``[a]ccount locks can be an effective 
tool to increase the security of customer accounts on occasion,'' but 
it suggests that because ``they are not needed to manage the risk of 
fraud in every case and for every customer,'' wireless providers should 
not be required to offer them to all customers. While AT&T's approach 
would leave the choice of whether an account lock is necessary 
exclusively in the hands of wireless providers, we conclude this choice 
should be placed principally in the hands of the customer, the party 
that is potentially at risk for SIM swap fraud, and therefore we 
require providers to offer the option to all customers. Likewise, 
AT&T's concern that ``an account lock can be a source of friction'' 
even for a postpaid customer when the ``customer forgets having placed 
the freeze on the account or dislikes the efforts needed to unfreeze 
the account'' is not, we conclude, a valid basis for declining to 
require that wireless providers offer SIM change locks. The benefits of 
this account security measure outweigh any potential friction, and we 
expect that wireless providers can take steps to mitigate any such 
friction if they choose, such as by providing customers with periodic 
reminders that they have activated the account lock and on how they can 
deactivate the lock. Because of the authentication challenges for pre-
paid customers and the potential friction for customers who may not 
want SIM changes to be more difficult, we decline to require account 
locks be activated by default, on an opt-out basis, as BPI/BITS 
suggests. We are also unconvinced by comments claiming that SIM change 
locks may be of limited value to customers. This requirement empowers 
high-risk and security-minded customers to enable additional 
protections beyond the enhanced authentication requirements and other 
security measures we adopt today, and it need not be activated by a 
large percentage of customers for it to be valuable.
5. Tracking Effectiveness of SIM Change Protection Measures
    31. We require wireless providers to establish processes to 
reasonably track and maintain information regarding SIM change requests 
and their authentication measures, and to retain that information for a 
minimum of three years. We agree with the Princeton University 
researchers that a tracking requirement will equip wireless providers 
``to measure the effectiveness of their customer authentication and 
account protection measures,'' and find that they would not otherwise 
be able to do so effectively without collecting such information. 
Consistent with recommendations in the record by the Princeton 
University researchers, we specifically require wireless providers to 
collect and maintain the following information regarding SIM change

[[Page 85801]]

requests and authentication measures: the total number of SIM change 
requests, the number of successful SIM changes requests, the number of 
failed SIM change requests, the number of successful fraudulent SIM 
change requests, the average time to remediate a fraudulent SIM change, 
the total number of complaints received regarding fraudulent SIM 
changes, the authentication measures the wireless provider has 
implemented, and when those authentication measures change. We also 
strongly encourage them to collect and retain any additional 
information that will help them measure the effectiveness of their 
customer authentication and account protection measures. We find that 
the three-year retention period is appropriate because it allows 
providers to track the effectiveness of their measures over time and 
ensures the information is available for a sufficient time should the 
Commission request it for review. The requirement that wireless 
providers collect and maintain information regarding when 
authentication measures change simply means that providers must track 
the introduction and removal of such measures, and not updates or 
refinements to existing measures.
    32. We disagree with CTIA's assertions that a recordkeeping 
requirement will divert resources from combating incidences of SIM swap 
fraud. Instead we find that this data tracking requirement is critical 
to wireless providers' efforts to keep ahead of evolving fraud 
techniques. And the record reflects that some wireless providers 
already track and analyze information regarding SIM swap fraud and 
their account protection measures to improve those measures, indicating 
that this is a practical and cost-effective practice. Thus, while we 
recognize that this recordkeeping requirement may not be without cost, 
particularly for wireless providers who do not already collect such 
information, we find that the benefits of this requirement far exceed 
any potential costs.
    33. We agree with CTIA that the data tracking and retention 
requirements should only be prospective in nature, and as such, we make 
clear that our rule does not obligate wireless providers to research 
and collect historic data. We conclude that including historic data in 
the data tracking requirements we adopt would be burdensome, or even 
impossible, for small wireless providers and those who do not already 
track this information. We decline to adopt reporting and audit 
requirements in conjunction with our data tracking requirement, but we 
do require wireless providers to make the information they collect 
available to the Commission upon request. Because the information we 
require wireless providers to collect does not include personally 
identifiable information (PII) or CPNI, wireless providers will not be 
required to provide PII or CPNI in response to Commission requests for 
this information, but the Enforcement Bureau may request PII or CPNI in 
the course of a specific investigation. Although regular reporting and 
audit requirements can improve wireless provider incentives and 
accountability, we do not find that such measures are necessary at this 
time in light of the other measures we adopt today and providers' 
ongoing commitment to be vigilant in combating fraud. We maintain the 
ability to obtain collected information from wireless providers as 
needed, not only as a potential tool to evaluate whether providers are 
implementing sufficient measures to address SIM swap fraud, but also to 
evaluate whether the specific requirements we adopt today continue to 
be effective or in need of updates to address the evolution of fraud 
techniques. Consequently, we find that there are insufficient benefits 
of a regular reporting requirement to outweigh the potential costs.
6. Safeguards on Employee Access to CPNI
    34. We require wireless providers to establish safeguards and 
processes so that employees who receive inbound customer communications 
are unable to access CPNI in the course of that customer interaction 
until after a customer has been properly authenticated. We find, based 
on the record before us, that requiring wireless providers to limit 
access to CPNI by employees who receive inbound customer communications 
until after the customer has been properly authenticated will help to 
minimize the incidences of SIM swap fraud by preventing customer 
service representatives from inadvertently or intentionally assisting 
bad actors in fraudulent schemes. We are persuaded that, even with the 
customer service representative training requirements we adopt today, 
allowing employees who receive inbound customer communications to 
access CPNI prior to proper authentication of the customer is 
unnecessary and possibly ``invites adversaries to exploit sympathetic, 
inattentive, or malicious customer service representatives for account 
access.'' While we anticipate that employees will comply with training 
requirements in good faith, ``[t]here should be no opportunity for a 
representative to give a hint or a free pass'' that will help bad 
actors commit fraud. We therefore conclude that requiring wireless 
providers to establish safeguards and processes so that employees who 
receive inbound customer communications are unable to access CPNI in 
the course of that customer interaction until after the customer has 
been properly authenticated--``a straightforward fix'' and standard 
data security best practice--will provide meaningful protection in 
helping to combat SIM swap fraud. We find that the benefits of this 
requirement outweigh any potential costs, and that any such costs will 
be mitigated by allowing telecommunications carriers flexibility to 
determine the particular safeguards and processes that will prevent 
employees who receive inbound customer communications from accessing 
CPNI in the course of that customer interaction until after a customer 
has been properly authenticated. Below, we seek comment on whether to 
require all telecommunications carriers to limit access to CPNI by 
employees who receive inbound customer communications until after the 
customer has been properly authenticated to minimize customer account 
fraud.
    35. We decline to adopt other suggested employee safeguards that 
are overly prescriptive and for which the costs outweigh the benefits. 
In the SIM Swap and Port-Out Fraud Notice we sought comment on other 
ways to avoid employee malfeasance, such as requiring two employees to 
sign off on every SIM change. Although we anticipate that two-employee 
sign off could be an effective account protection mechanism and 
encourage wireless providers to use this procedure when appropriate, we 
are persuaded by AT&T's argument that requiring this procedure for 
every SIM change would be a significant burden on legitimate SIM change 
requests given the uncertainty regarding whether it would prevent SIM 
swap fraud in most instances, and therefore decline to adopt it. We 
also reject several other requirements proposed in the record 
concerning customer service representatives who perform SIM changes. 
Specifically, a mandate that employees who perform SIM swaps be subject 
to enhanced background checks may be financially and practically 
infeasible for large and small wireless providers alike, and could 
create an incentive for providers to reduce the number of employees 
capable of

[[Page 85802]]

performing SIM changes, which would slow the processing of legitimate 
changes. Requiring employees to swipe a company badge when entering 
secure facilities is a good practice that we encourage wireless 
providers to adopt, but the record does not address how this 
requirement would serve to prevent SIM swap fraud. The proposal to 
require employees to sign a restrictive confidentiality agreement is 
faulty for the same reason. Moreover, a proposed restriction on use of 
performance incentives is overly broad, could stifle competition, and 
might prevent customers from accessing special offers. Finally, we 
decline to adopt a proposal that wireless providers ``be required to 
have heightened SIM swap customer care during [weekends and 
evenings].'' We find that providers are best positioned to implement 
procedures tailored to the level of risk at any given time and should 
have the flexibility to adjust their practices to address the evolving 
nature of fraudulent activity.
7. Telecommunications Carriers' Duty To Protect CPNI
    36. While the record shows that some wireless providers have 
implemented CPNI security practices beyond those required by current 
rules, SIM swap fraud persists. We are also concerned that some 
wireless providers may view the protection measures we adopt today as 
sufficient, rather than baseline, protections against SIM swap fraud. 
To ensure that wireless providers adapt their security practices on an 
ongoing basis to address evolving techniques used by bad actors to 
commit SIM swap fraud, we take this opportunity to remind all 
telecommunications carriers of their statutory duty to ``protect the 
confidentiality of proprietary information of, and relating to . . . 
customers,'' and their continuing preexisting legal obligation to 
``take reasonable measures to discover and protect against attempts to 
gain unauthorized access to CPNI.'' Consistent with the Commission's 
approach in the 2007 CPNI Order, we conclude that these existing legal 
obligations necessarily obligate telecommunications carriers to 
proactively and regularly review and monitor their policies and 
procedures to ensure that they continue to be effective at addressing 
evolving fraud techniques against customer accounts and services--
including SIM swap and port-out fraud--and to conduct analyses of fraud 
incidents to determine how the fraud occurred and implement measures to 
prevent such tactics from being successful again in the future.

B. Strengthening the Commission's Number Porting Rules To Protect 
Consumers

    37. Given the potential for consumer harm from port-out fraud, we 
conclude that the time is ripe to strengthen our number porting rules 
with baseline measures to increase the protections for customers 
against fraudulent port-outs. As with our new SIM change rules, the 
backbone of our new number porting rules is a requirement that wireless 
providers use secure methods to authenticate customers that are 
reasonably designed to confirm a customer's identity prior to 
effectuating number ports, and we also require wireless providers to 
notify customers of port-out requests and allow customers to lock their 
accounts to prevent port-outs. To future-proof our requirements, we 
give wireless providers flexibility in how to implement them. We 
anticipate that these new rules will work together to provide 
meaningful protection to customers while preserving the efficient and 
effective processing of port-out requests that promotes customer choice 
and competition. As with our new SIM change rules, we apply these new 
requirements exclusively to providers of CMRS, as defined in Section 
20.3 of Title 47 of the Code of Federal Regulations, including 
resellers of CMRS, as the record shows that port-out fraud is focused 
on mobile wireless customers. We likewise require wireless providers to 
implement these rules with respect to customers of both pre-paid and 
postpaid services.
1. Customer Authentication Requirements
    38. We revise our porting rules to require that wireless providers 
use secure methods to authenticate customers that are reasonably 
designed to confirm a customer's identity before completing a port-out 
request, except to the extent otherwise required by the Safe 
Connections Act or the Commission's rules implementing that statute. 
Consistent with our new SIM change authentication rules, we require 
wireless providers to regularly, but not less than annually, review 
and, as necessary, update their customer authentication methods to 
ensure those methods continue to be secure.
    39. The Safe Connections Act prohibits wireless providers from 
making a line separation contingent on a prohibition or limitation on 
number portability, provided such portability is technically feasible. 
The Commission's rules adopted today implementing the Safe Connections 
Act require covered providers to attempt to authenticate, using 
multiple authentication methods if necessary, that a survivor 
requesting a line separation is a user of a specific line or lines. 
Covered providers must use methods that are reasonably designed to 
confirm the survivor is actually a user of the specified line(s) on the 
account when the survivor is not the primary account holder or a 
designated user. To the extent this requirement differs from other 
authentication requirements, including those in 47 CFR 64.2010, the 
line separation authentication requirements the Commission adopts to 
implement 47 U.S.C. 345 serve as an exception to those other 
requirements.
    40. As in the SIM change context, we are persuaded by commenters 
that a general security authentication standard will best allow 
wireless providers the flexibility to respond to advances in the 
technology and tactics used by bad actors, providing the greatest 
protection for customers, and enabling providers to implement 
authentication methods in ways that work best for the particular 
services they offer. The record reflects that the benefits of allowing 
wireless providers to determine the best method for authenticating 
customers outweigh speculative concerns that absent standardized 
authentication methods, nationwide providers could arbitrarily 
determine which authentication methods or controls are sufficient 
before effectuating ports. We note also that under the Act and our 
existing rules, all carriers are required to complete legitimate ports, 
and that our new customer authentication requirements do not give 
carriers the authority to make determinations about the sufficiency of 
another carrier's authentication methods--that responsibility will 
belong to the Commission, and we will address any concerns regarding 
the adequacy of authentication methods, as well as inappropriate port 
denials, as needed. We also agree with CCA that our approach will 
better serve small wireless providers by permitting them to ``use 
technologies that are reasonably available and have choice in the 
approach to take in authenticating their customers.'' Additionally, as 
we concluded with regard to authentication for SIM changes, this 
flexible approach should resolve concerns about authenticating 
customers of pre-paid accounts.
    41. We are mindful of the potential effect on competition of our 
new customer authentication requirements, and thus, we require that the 
secure authentication methods wireless providers adopt accommodate the 
needs

[[Page 85803]]

of the broad spectrum of customers they may serve, including those who 
do not have data plans or data-enabled devices, have varying degrees of 
technological literacy, or have disabilities or accommodation needs. To 
illustrate, we observe that wireless providers may find requiring a 
one-time port-out PIN obtained through a provider app is an effective 
means for authenticating customers with a data-enabled smart phone, but 
that authentication measure may not be a feasible option for customers 
without data plans or smartphones, or for those customers who are 
unable to navigate the technology. As such, this requirement may 
necessitate the use of multiple authentication methods, such as in-
person authentication using government-issued identification, over-the-
phone authentication, or alternative methods for individuals with 
disabilities.
    42. We do not anticipate that using secure methods to authenticate 
a customer requesting a port-out will be burdensome to wireless 
providers or unreasonably delay the processing of port-out requests. 
The record reflects that many wireless providers have already developed 
and implemented some form of customer authentication for port-out 
requests. The approach we adopt today will allow wireless providers to 
continue using or building upon what is already working in the 
industry, helping to streamline implementation and costs. We expect 
wireless providers to design and implement customer authentication 
processes for port-out requests that minimize porting delays and 
maintain the industry agreed-upon two-and-a-half hour porting interval 
for wireless ports.
2. Customer Notification of Port-Out Requests
    43. We also revise our numbering rules to require wireless 
providers to provide immediate notification to their customers whenever 
a port-out request is made, sent in accordance with customer 
preferences, if indicated, and specify that the notification must be 
sent before a provider effectuates a port, except to the extent 
otherwise required by the Safe Connections Act of 2022 (47 U.S.C. 345) 
or the Commission's rules implementing that Act. For example, this 
would include delivering a notification in the language of the 
customer's choosing, if the wireless provider permits communications 
preferences in other languages and the customer has previously 
indicated such choice. We require that wireless providers notify their 
customers ``immediately'' of a porting request to not only ensure that 
porting requests are processed efficiently, but also help alert 
customers quickly to potential fraud to allow them to mitigate damages 
and inconvenience resulting from fraudulent or inadvertent port-outs. 
The notification requirement will provide a uniform safety measure for 
all port-out requests across the mobile wireless industry, which we 
anticipate will reduce the instances of port-out fraud. For the same 
reasons we raised in the SIM change context, we decline to impose a 
blanket yes/no verification requirement for authentication attempts.
    44. As with SIM change notifications, we decline to prescribe 
particular methods for providing port-out notifications or particular 
content and wording for these notifications, but do require that the 
notification methods be reasonably designed to reach the customer 
associated with the account and that the content and wording use clear 
and concise language that provides sufficient information to 
effectively inform a customer that a port-out request involving the 
customer's number was made. We recognize that wireless providers are in 
the best position to determine which notification methods and what 
content and wording will be most effective at notifying customers of 
port-out requests and potential fraud under the particular 
circumstances, including the real-world security needs of the 
transaction, and the technical capabilities, accessibility needs, or 
broadband access of individual customers. As such, we encourage 
wireless providers to leverage existing notification methods that are 
reasonably designed to reach the customer associated with the account, 
and to adopt new notification methods as they are developed to stay 
responsive to evolving fraud schemes.
    45. On balance, we find that benefits accrued from early warning to 
customers of potential fraudulent account activity outweigh any 
potential burdens imposed on wireless providers by this notification 
requirement. First, we find that customer notification of port-out 
requests is unlikely to prevent or unreasonably delay customer porting 
requests, as we require ``immediate'' notification and do not require a 
delay or customer verification or acknowledgement of that notification 
before continuing the porting-out process. Second, because wireless 
providers are already familiar with notifying customers regarding 
changes to their accounts, and in many cases likely already notify 
customers of port-out requests, we anticipate that wireless providers 
will face low burdens in implementing today's customer notification 
requirement for port-out requests. We also expect that these existing 
notification systems can be leveraged to help minimize any potential 
costs associated with notifying customers of port-out requests. Third, 
we disagree with AT&T's assertion that customer notification of port-
out requests will result in notice fatigue, undermining its efficacy. 
Nothing in the record supports the notion that customers request port-
outs at such a rate that, upon the adoption of this rule, wireless 
providers will be forced to inundate their customers with the required 
notifications. For the same reasons, we decline CTIA's request that 
customer notification of port-out requests be ``limited to situations 
where the carrier determines that there is an increased risk of fraud'' 
on the basis that the notification requirements ``threaten to cause 
customer confusion, concern, and fatigue,'' and could increase costs 
for carriers because such notifications increase customer calls. As 
such, we conclude that the significant benefits of alerting customers 
to potential fraudulent account activity outweighs any speculative 
negative impacts on wireless providers or customers.
3. Account Locks for Port-Outs
    46. For the same reasons explained above with respect to SIM change 
requests, we require wireless providers to offer their customers, at no 
cost, the ability to lock or freeze their accounts to stop port-outs. 
We anticipate that this requirement will provide customers with more 
consistent and meaningful protection against fraudulent port-outs. The 
record reflects that account locks can be powerful tools against 
fraudulent port-outs, particularly for customers that are at high-risk 
of being a target of the practice. As in the SIM swap context, we 
conclude that it should be offered to customers of both pre-paid and 
post-paid services, and that this requirement is feasible for both 
categories of customers despite assertions to the contrary. Because the 
account lock is an optional security measure for customers, carriers 
can, if necessary, require customers to provide information to use for 
authentication purposes to activate and deactivate the account lock.
    47. Like the other rules we adopt today, we give wireless providers 
flexibility on how to comply with the measure. In particular, the 
record does not evince a need for us to prescribe a method or methods 
for customers to unlock or unfreeze their accounts or impose a waiting 
period before an unlocked account can be transferred, and as such, we 
decline to do so at this time. Although we do not prescribe the

[[Page 85804]]

exact form of the account lock mechanism wireless providers must adopt, 
the process to activate and deactivate an account lock must not be 
unduly burdensome for customers such that it effectively inhibits them 
from implementing their choice. We stress that when activated, wireless 
providers must not fulfill port-out requests until the customer 
deactivates the lock, except to the extent otherwise required by the 
Safe Connections Act or the Commission's rules implementing that 
statute. We decline CTIA's request that the Commission find that 
mandatory port-out PINs satisfy this requirement. We discuss the 
benefits and drawbacks of port-out PINs as a method of customer 
authentication, above. We disagree that a mandatory port-out PIN has 
the same effect as an optional account lock; while the two protections 
serve complementary functions, one is focused on customer 
authentication for a specific one-time request, and the other functions 
as a customer directed general account security feature.
    48. Consistent with this flexible approach, and as we did with the 
SIM change rules, we permit wireless providers to proactively initiate 
a port-out lock on a customers' account when they believe a customer 
may be at high risk of fraud, so long as providers promptly provide 
clear notifications to those customers that a lock has been activated 
with instructions on how the customers can deactivate account locks if 
they choose and promptly deactivates the account lock upon receipt of 
the customer's legitimate request to do so. We also caution wireless 
providers that any proactive initiation of a port-out lock must be 
limited in duration and extend only so long as the high risk of fraud 
is evident to the provider. In establishing this limitation, we intend 
to prohibit wireless provider abuse of port-out locks to avoid, among 
other outcomes, preventing the customer from terminating service with 
the provider or moving to another competing provider.
    49. As with account locks for SIM changes, given that several 
wireless providers already voluntarily offer account locks to all their 
customers, and coupled with the flexible approach we adopt, we are 
unpersuaded by AT&T's claim that implementing account lock offerings 
will be unduly costly and time-consuming for wireless providers. To the 
extent there are costs associated with the requirement, we find that 
they are outweighed by the benefits.
4. Wireless Port Validation Fields
    50. After review of the record, we decline to codify the wireless 
port validation fields. We also decline to require wireless providers 
to implement a customer-initiated passcode field for all wireless-to-
wireless number porting requests. Currently, the mobile wireless 
industry uses four data fields of customer-provided information to 
validate a wireless-to-wireless porting request: telephone number, 
account number, five-digit ZIP code, and passcode (if applicable). In 
the SIM Swap and Port-Out Fraud Notice, we sought comment on whether we 
should ``codify the types of information carriers must use to validate 
simple wireless-to-wireless port requests.'' While some commenters did 
not oppose codification of some of the customer-provided wireless data 
fields, they preferred that the Commission continue to give wireless 
providers the flexibility to adjust to business and customer needs. We 
are persuaded by the record that separate codification of the customer-
provided data fields for validation of wireless-to-wireless ports is 
not necessary at this time, as we have been provided no evidence that 
wireless providers are not complying with the validation obligations 
imposed in the Four Fields Declaratory Ruling. As such, we decline to 
separately codify the customer-provided wireless-to-wireless port 
validation fields at this time.

C. Additional Consumer Protection Measures

    51. In the SIM Swap and Port-Out Fraud Notice, we sought comment on 
whether we should adopt additional measures to address the problems 
associated with SIM swap and port-out fraud. As discussed below, we 
require that wireless providers inform customers of any account 
protection mechanisms the provider offers, ensure that customer service 
representatives are trained to recognize bad actors' attempts at these 
fraudulent schemes, and deliver timely resolution of SIM swap and port-
out fraud when it does occur. We decline, however, to establish a 
working group to further study and develop solutions to address the 
harms of SIM swap and port-out fraud. We also decline to adopt other 
proposals in the record regarding wireless provider liability and 
dispute resolution related to SIM swap and port-out fraud.
    52. Customer Notice of Account Protection Measures. Many of the 
account protection measures wireless providers offer and that we 
require wireless providers to adopt today are designed to empower 
customers to take steps to protect themselves from SIM swap and port-
out fraud if they choose, but this empowerment will be stifled if 
customers are not effectively made aware of the measures that are 
available. Accordingly, we require wireless providers to provide 
notice, using clear and concise language, of any account protection 
measures the provider offers, including the measures we adopt in this 
Report and Order, and make this notice easily accessible via provider 
websites and applications. We decline to specify the exact format or 
content of the required notice, as we agree with CCA that wireless 
providers are well-positioned to determine exactly how best to 
communicate information about account protection measures to their 
customers. The record also demonstrates that some wireless providers 
have already developed content to educate customers about some account 
protection measures.
    53. We decline to require wireless providers to deliver an annual 
notice to customers regarding the availability of the account 
protection mechanisms they offer. The record does not exhibit support 
for this requirement and we have no basis for concluding that it would 
be meaningfully more beneficial for customers than our requirement that 
wireless providers make notice about the availability of account 
protection measures easily accessible through provider websites and 
applications. We therefore decline to adopt an annual notice 
requirement.
    54. Employee Training. We require wireless providers to develop and 
implement training for employees on how to identify, investigate, 
prevent, and remediate SIM swap and port-out fraud. We find that 
adopting this employee training requirement will serve as a ``first 
line of defense'' against these damaging and evolving practices by 
preparing employees to defend against such fraud and preventing them 
from inadvertently or intentionally assisting bad actors in fraudulent 
schemes.
    55. We agree with Verizon that ``customer care and employee 
training programs are critical for preventing and identifying 
unauthorized and high-risk SIM changes for postpaid customers,'' and we 
find that all customers will benefit from employee training. The record 
reflects the industry's recognition of the importance of employee 
training; the country's three largest wireless providers--Verizon, T-
Mobile, and AT&T--have already implemented some training measures for 
customer service representatives to identify, prevent, and remediate 
fraud. The record also shows, however, that some wireless providers' 
current practices for customer service representative training may be 
lacking, as there are reported instances of wireless provider employees 
failing to identify, prevent, or quickly remediate

[[Page 85805]]

SIM swap and port-out fraud. We have previously determined that 
customer service training requirements play an important role in 
safeguarding the proper use of CPNI and have required 
telecommunications carriers to train their personnel on when they are 
and are not authorized to use CPNI. We similarly conclude that the 
employee training requirement we adopt today is necessary to ensure 
customer service representatives are prepared to identify, prevent, and 
remediate fraudulent SIM change and port-out activity.
    56. In applying this requirement, we give wireless providers 
flexibility on designing their training programs. But we do require 
that all employees who may communicate with customers regarding SIM 
changes and number ports must be trained on how to recognize 
potentially fraudulent requests, how to recognize when a customer may 
be the victim of fraud, and how to direct potential victims and 
individuals making potentially fraudulent requests to employees 
specifically trained to handle such incidents. Given that (1) some 
wireless providers already train employees on how to address fraud, (2) 
our new training requirement builds upon our existing CPNI training 
rule, and (3) we are providing wireless providers with flexibility on 
how to design their training programs, we do not anticipate that 
imposing this training requirement will be overly costly for wireless 
providers.
    57. Requirements to Remedy SIM Swap and Port-Out Fraud. We are 
concerned that in some cases, ``consumers who have been the victims of 
SIM swaps or port-out fraud have had difficulties obtaining assistance 
from the carriers'' when they report it. Accordingly, we require 
wireless providers to maintain a clearly disclosed, transparent, and 
easy-to-use process for customers to report SIM swap and port-out 
fraud, promptly investigate and take reasonable steps within their 
control to remediate such fraud, and, upon request, promptly provide 
customers with documentation of SIM swap and port-out fraud involving 
their accounts. These measures must be provided to victims of SIM swap 
and port out fraud at no cost. We anticipate that, in combination, 
these requirements will serve to minimize the harms that victims 
experience as a result of SIM swap and port-out fraud.
    58. Our requirement that wireless providers maintain a clearly 
disclosed, transparent, and easy-to-use process for customers to report 
SIM swap and port-out fraud rests on our concern that customers 
currently struggle to report SIM swap and port-out fraud to their 
wireless providers. When customers are unable to find information about 
how to report such fraud or use existing customer service avenues to do 
so, it not only frustrates these customers, it prevents initiation of 
steps to investigate and remediate the fraud, which increases the risk 
that fraudsters will be able to use a victim's SIM or phone number to 
accomplish further fraud. We anticipate that clear methods for 
reporting SIM swap and port-out fraud that are transparent to customers 
will ``ensure that customers have easy access to information they need 
to report SIM swap, port-out, or other fraud.'' We decline to specify 
the exact means wireless providers must put in place for customers to 
report SIM swap and port-out fraud, but we stress that the process must 
be a clearly disclosed, transparent, and easy-to-use process for 
customers to notify providers.
    59. We require wireless providers to establish procedures to 
promptly investigate and take reasonable steps within their control to 
remediate SIM swap and port-out fraud because the record demonstrates 
that even when victims of SIM swap and port-out fraud are successful in 
reporting such fraud to their providers, they have difficulty obtaining 
assistance from their providers to remediate the fraud. This is 
consequential because ``[i]dentity theft, including SIM swap fraud, can 
cause intense anxiety for victims and must be addressed in a timely 
manner to prevent financial losses and exposure of personal 
information.'' Thus, we conclude that ``it should be easy for a 
customer to get access to appropriate carrier resources that can help 
mitigate the significant harms caused by SIM swap or port-out fraud.'' 
Although we do not specify the procedures that wireless providers must 
adopt, we agree with commenters that investigations must be instigated 
and resolved expeditiously.
    60. To ensure victims of SIM swap and port-out fraud have 
additional means to resolve other consequences that result from SIM 
swap and port-out fraud, we require wireless providers to give 
customers documentation regarding such fraud on their accounts, upon 
request. In the SIM Swap and Port-Out Fraud Notice, we recognized that 
``customers sometimes need documentation of the fraud incident to 
provide to law enforcement, financial institutions, or others to 
resolve financial fraud or other harms of the incident'' and 
acknowledged that ``[a] SIM swap or port-out fraud victim may have 
difficulty obtaining such documentation from the carrier because the 
carrier may not have processes in place to produce such 
documentation.'' Requiring wireless providers to give fraud victims 
supporting documentation will enable those victims to seek remedies 
from other institutions for additional fraud that bad actors achieve 
using a victim's SIM or phone number. We do not specify the form that 
such documentation must take or exactly what information it must 
contain, but it should be reasonably designed to permit customers to 
demonstrate to other entities that they were victims of SIM swap or 
port-out fraud and that bad actors may have used access to a victim's 
telecommunications services to carry out additional fraud. Such 
documentation must address the customer's interest in protecting his or 
her account(s) or identity but may be tailored not to include other 
proprietary, confidential, or law-enforcement-related information 
regarding the SIM swap or port-out fraud or the account. Additionally, 
because of the potential harms that can flow from SIM swap and port-out 
fraud, we also require wireless providers to provide this documentation 
promptly.
    61. We anticipate that the benefits of our requirements will 
outweigh any potential costs. Although commenters did not address the 
costs of the additional measures we adopt here, we note that at least 
one wireless provider has already adopted processes for customers to 
report SIM swap and port-out fraud, to investigate and remediate such 
fraud, and to provide documentation of such fraud to customers upon 
request. We also anticipate that allowing wireless providers 
flexibility in how to abide by these new requirements will enable them 
to adopt cost-effective procedures that will also allow them to 
successfully resolve SIM swap and port-out fraud incidents when they 
occur.
    62. To maintain the flexibility we believe will be required for 
wireless providers to adequately tailor and adapt their practices to 
address SIM swap and port-out fraud, we decline to impose prescriptive 
measures raised in the SIM Swap and Port-Out Fraud Notice and the 
record. Specifically, although we encourage wireless providers to 
establish a dedicated hotline for customers to report SIM swap and 
port-out fraud and respond within 24 hours of a customer reporting 
suspected fraud, we decline to require that wireless providers adopt 
these approaches. While the former requirement received support from 
the National Consumer Law Center (NCLC) and the Electronic Privacy 
Information Center (EPIC), we

[[Page 85806]]

conclude that it may not benefit a wireless provider's customers if it 
is inconsistent with a provider's established customer service methods. 
The latter may be infeasible for certain incidents and is not necessary 
given our requirement that investigation and remediation be prompt. We 
also decline to require that wireless providers give customers an 
alternative number on a temporary basis after SIM swap or port-out 
fraud has occurred, as that may promote number resource exhaust in 
certain areas or for certain wireless providers. However, we encourage 
wireless providers to offer customers a temporary alternative number 
when the efforts to remediate SIM swap or port-out fraud may take a 
significant amount of time or to assist customers who have critical 
needs to be accessible via phone at the time. We also recognize that 
adequate remediation may require providing victims with permanent 
replacement numbers or SIMs, and carriers should effectively assist 
customers with that transition should that be necessary. We do not find 
it necessary at this time to require that wireless providers, upon 
being notified by a customer of fraud, provide ``detailed records of 
the fraud [to law enforcement]'' or ``offer to the customer to notify 
financial institutions and creditors, the three national credit 
reporting agencies, and others of the fraud, to help the customer 
recover control over their identity, if appropriate.'' While we 
encourage wireless providers to take these steps upon the request of 
customers as part of their mitigation efforts, we conclude that our new 
requirement that providers give customers documentation concerning 
fraudulent SIM swaps and number ports will be sufficient to allow those 
customers to alert appropriate entities if needed. We note, however, 
that we will monitor consumer complaints and may evaluate the 
remediation programs implemented by wireless providers. If we find that 
such programs are not adequately resolving SIM swap and port-out fraud 
in a timely manner, we may take steps to implement more specific 
requirements in the future.
    63. Working Group. While we recognize that the harmful effects of 
SIM swap and port-out fraud may extend beyond the control of wireless 
providers and that the incentives to engage in such fraud implicate the 
security practices of other industries, we decline at this time to 
direct or rely on standard-setting bodies, industry organizations, or 
consumer groups to evaluate SIM swap and port-out fraud ``to augment 
our understanding and present possible solutions.'' Instead, we find it 
most appropriate to focus on solutions within the scope of the 
Commission's authority that we anticipate will mitigate the harmful 
consequences of this fraud. Additionally, to the extent that commenters 
advocated that we direct this issue to a working group before taking 
action, we disagree with that approach and find that doing so would 
only delay solutions that we expect will benefit customers now. 
Although we decline to rely on a working group, we also do not 
foreclose wireless providers from forming or entering into cross-
sector, multi-stakeholder efforts, independent of Commission direction, 
to seek broader solutions to the harms that may ultimately result from 
SIM swap and port-out fraud.
    64. Provider Liability and Dispute Resolution. We decline to adopt 
proposals in the record that prescribe provider liability and dispute 
resolution requirements for disputes between wireless providers and 
customers.
    65. NCLC and EPIC argue that the Commission should ``[r]equire 
carriers to offer a redress program that . . . provides full coverage 
of losses to customers who have been the victims of a fraudulent SIM 
swap or port-out fraud,'' which they say would ``[p]rovide strong 
financial incentives to providers to stop SIM swapping and port-out 
fraud.'' We agree with CTIA, however, that telecommunications carriers 
are ``but one link in the chain of consumer and business protection 
from account takeover fraud,'' and therefore that the responsibility 
for financial harms that a bad actor may be able to perpetuate 
following such fraud is borne by several parties, including, 
significantly, the bad actor. Imposing such liability on wireless 
providers would be inequitable and would reduce the incentives for 
email and social media providers, financial institutions, healthcare 
providers, retail websites, and other entities that rely on cell phone-
based identity authentication to improve their security practices, as 
well as reduce the incentive for customers to act responsibly. We note, 
however, that compliance with our rules is not a safe harbor for 
wireless providers; customers will still be able to pursue any existing 
remedies available by law.
    66. Similarly, we decline to specify, as NCLC and EPIC request, 
that wireless providers are ``fully responsible for any abuse committed 
by its employees, whether the employees acted either intentionally or 
negligently,'' although we make clear that this statement does not 
absolve wireless providers of any liability for employee actions that 
already exists. We anticipate that the requirements we adopt today--
including employee training regarding SIM swap and port-out fraud and 
restrictions on the ability of employees to access CPNI prior to 
authentication--will ensure that wireless providers implement adequate 
procedures to prevent employees from perpetuating SIM swap and port-out 
fraud.
    67. Finally, we decline to adopt NCLC and EPIC's proposal that 
``any arbitration clauses in the providers' agreements with consumers 
explicitly exclude resolutions'' of SIM swap and port-out fraud 
disputes at this time. They urge this because ``[o]therwise, consumers 
who have not been made whole, or who have difficulties obtaining relief 
for frauds that are perpetrated on them because of the provider's 
insufficiently strict authentication protocols, will have no meaningful 
way of enforcing the protections mandated by the Commission.'' The 
Commission has full authority to enforce the protections it has 
mandated, and we anticipate that the rules we adopt today, coupled with 
this enforcement authority, will incentivize wireless providers to 
adopt strong practices to protect customers from SIM swap and port-out 
fraud. Nonetheless, we seek comment below on whether the Commission 
should require providers to exclude disputes about SIM swapping or 
porting fraud from arbitration clauses. We encourage customers and 
public interest organizations to submit complaints and evidence of 
wireless providers failing to comply with these new rules in support of 
our enforcement efforts.

D. Implementation Timeframe

    68. We require wireless providers to comply with the requirements 
we adopt today six months after the effective date of the Report and 
Order or, for those requirements subject to review by the Office of 
Management and Budget (OMB), upon completion of that review, whichever 
is later. We conclude that providing six months to achieve compliance 
with rules that are not subject to OMB review accounts for the urgency 
of safeguarding customers from these fraudulent schemes, and will allow 
wireless providers to coordinate any updates needed to their systems 
and processes to comply with the Safe Connections Act and the rules we 
adopt to implement that statute. SIM swap and port-out fraud can result 
in substantial harm to the customer, including loss of service on their 
devices. Fraudulent SIM swaps and port-outs allow bad actors to 
perpetrate greater fraud by giving them the means to complete text and 
voice

[[Page 85807]]

authentications to access the victim's other accounts, and as such, we 
find that an aggressive implementation timeframe is appropriate to 
provide these important consumer protections without substantial delay. 
We agree with some commenters that while many wireless providers can 
immediately implement the revisions to our CPNI and number porting 
rules, other providers may require this additional time. Some wireless 
providers already employ authentication and notification measures to 
process SIM change and port-out requests, offer account change locks, 
provide notice to customers about available fraud protection measures, 
and train employees on how to address SIM swap and port-out fraud, and 
may simply need to refine those practices to align with our rules. 
Other providers, particularly smaller providers, may need the 
additional time to upgrade their systems, implement modifications to 
their policies and procedures, and conduct new customer service 
representative training. We conclude that providing six months after 
the effective date of the Report and Order to implement these revisions 
to our CPNI and number porting rules strikes the right balance between 
time for wireless providers to implement these changes and accounting 
for the urgency of safeguarding customers from these fraudulent 
schemes. We also find that this implementation timeframe is consistent 
with other proceedings and regulatory frameworks adopted by the 
Commission where consumer protection and numbering requirements were at 
issue. While we acknowledge industry's concerns that implementing these 
new rules will be a multistep process for many providers, providers 
themselves acknowledge the necessity of implementing today's revisions 
to our CPNI and LNP rules concurrently with our rules implementing the 
Safe Connections Act, given how both frameworks address many of the 
same actions (e.g., account locks, customer notifications, customer 
authentication). And as we explain in the Safe Connections Order, 
``permitting a more extended compliance timeframe for implementing the 
line separation provisions, as advocated for by industry commenters, 
would be inconsistent with the urgency Congress demonstrated with the 
underlying statutory obligation as well as with the critical wireless 
communications needs of survivors well-documented in the record.'' For 
all of these reasons, we require wireless providers to implement the 
rules we adopt today six months after the effective date of this Report 
and Order, subject to review by OMB.

E. Legal Authority

    69. The rules we adopt today build on the Commission's existing 
rules to implement Congress's mandates to ensure that 
telecommunications carriers (which include, for purposes of our CPNI 
rules, providers of interconnected VoIP service) protect the 
confidentiality of proprietary information of, and relating to, 
customers and to provide number portability in accordance with 
requirements prescribed by the Commission. As such, the rules we adopt 
are well-grounded in our authority in Sections 222 and 251, as well as 
other provisions of the Act.
    70. SIM Changes. Congress, through Section 222 of the Act, requires 
telecommunications carriers to protect the privacy and security of 
customers' proprietary information that carriers obtain by virtue of 
providing a telecommunications service. Under Section 222(a), every 
telecommunications carrier has a ``duty to protect the confidentiality 
of proprietary information of, and relating to, . . . customers.'' 
Section 222(c)(1) provides that a telecommunications carrier may only 
use, disclose, or permit access to customers' individually identifiable 
CPNI that it has received or obtained by virtue of its provision of a 
telecommunications service in limited circumstances: (1) as required by 
law; (2) with the customer's approval; or (3) in its provision of the 
telecommunications service from which such information is derived or 
its provision of services necessary to, or used in, the provision of 
such telecommunications service.
    71. The Commission has previously stated that to comply with these 
Section 222 requirements, ``telecommunications carriers [must] 
establish effective safeguards to protect against unauthorized use or 
disclosure of CPNI.'' The Commission also has established rules 
pursuant to its Section 222 authority to ensure such safeguards are in 
place. Among other things, the Commission's rules require carriers to 
take ``reasonable measures to discover and protect against attempts to 
gain unauthorized access to CPNI'' and to ``properly authenticate a 
customer prior to disclosing CPNI based on customer-initiated telephone 
contact, online account access, or an in-store visit.'' Like these 
safeguards, our action today ``strengthen[s] our privacy rules by 
adopting additional safeguards to protect customers' CPNI against 
unauthorized access and disclosure.''
    72. Fraudulent SIM swaps result in unauthorized disclosure of and 
access to customers' accounts, including individually identifiable 
CPNI. By successfully obtaining a fraudulent SIM swap, a bad actor can 
access CPNI such as incoming call information (including the date and 
time of the call and number from which the call is made), and gain 
access to a victim's account, potentially giving the bad actor access 
to other CPNI, like outgoing call history (including numbers called and 
the location, frequency, duration, and timing of such calls) and the 
victim's bills and the services purchased by the victim. And as 
described above, fraudulent SIM swaps allow bad actors to perpetrate 
greater fraud by giving them the means to complete text and voice 
authentications to access the victim's other accounts.
    73. In light of the foregoing, we find that the rules we adopt 
today to address SIM swap fraud advance the protections against 
unauthorized disclosure of, and access to, individually identifiable 
CPNI and other sensitive personal information about customers, and 
therefore are squarely grounded in the Commission's authority under 
Section 222. Our requirement that wireless providers use secure methods 
of authenticating their customers that are reasonably designed to 
confirm a customer's identity prior to effectuating a SIM change 
request will help prevent unauthorized disclosure of and access to such 
information. This requirement also sustains customer decisions 
regarding disclosure of their information--if a wireless provider 
completes a SIM change requested by someone other than the actual 
customer, then the wireless provider has not obtained the customer's 
approval to disclose their CPNI in accordance with Section 222(c)(1).
    74. The other rules we adopt reinforce the protections afforded by 
this new rule. For instance, the requirement that wireless providers 
develop, maintain, and implement procedures to respond to failed 
authentication attempts will likewise serve to prevent unauthorized 
disclosure of and access to CPNI. The rule requiring that wireless 
providers establish safeguards and processes so that employees who 
receive inbound customer communications are unable to access CPNI until 
after the customer has been properly authenticated will prevent 
inadvertent disclosure of CPNI to those making unauthorized requests 
and inhibit the ability of employees to participate in fraudulent SIM 
swaps. Employee training requirements will not only improve their 
ability to recognize and derail fraudulent SIM change requests, such 
requirements will better

[[Page 85808]]

prepare customer service representatives to address customer complaints 
and remediate fraudulent SIM swaps when they do occur. Requiring 
wireless providers to maintain a clear process for customers to report 
fraud, investigate and remediate fraud, and provide customers with 
documentation of fraud involving their accounts will ensure that the 
harms of SIM swap and port-out fraud are mitigated when it does occur. 
And the requirement that wireless providers keep records of data 
regarding SIM change requests and the authentication measures they have 
in place will help ensure that wireless providers have information they 
need to measure the effectiveness of their customer authentication and 
account protection measures and make informed decisions about how they 
should be updated over time.
    75. Our rules also further the goals of Section 222 by enabling 
customers to take action to prevent and address fraudulent SIM changes, 
and therefore help wireless providers protect against unauthorized 
disclosure and access to CPNI. The requirement that wireless providers 
immediately notify customers regarding SIM change requests provides 
added protection by giving customers information they can use to notify 
their providers that a fraudulent request has occurred at the time of 
the request or shortly thereafter so that the provider can take timely 
steps to remediate the situation. Requiring wireless providers to offer 
customers the option to lock their accounts so that their providers are 
prohibited from processing SIM changes gives security-minded customers 
or those who are at high risk of fraud a tool to prevent a fraudulent 
request from being processed in the first instance. Additionally, our 
new rule that wireless providers make notice of account protection 
mechanisms easily accessible via their websites and applications 
ensures that customers are aware of these tools. We also conclude that 
the requirements we establish to promptly resolve SIM swap and port-out 
fraud extend from our Section 222 authority because they will help to 
mitigate the unauthorized disclosure of and access to CPNI.
    76. Finally, the new customer authentication requirements, with 
which both facilities-based providers and resellers must comply, apply 
to both pre-paid and postpaid services, which is consistent with 
Section 222(a)'s mandate that ``[e]very telecommunications carrier . . 
. protect the confidentiality of [customer] proprietary information'' 
and Section 222's instruction that all ``customers'' of those carriers 
benefit from such protections.
    77. While Section 222 provides firm foundation for our rules to 
address SIM swap fraud, we also find that Section 251(e) of the Act 
provides additional authority for these rules. In Section 251(e)(1), 
Congress expressly assigned to the Commission exclusive jurisdiction 
over that portion of the North American Number Plan (NANP) that 
pertains to the United States and related telephone numbering issues. 
The Commission retained its ``authority to set policy with respect to 
all facets of numbering administration in the United States.'' Because 
our new SIM change rules prevent and address misuse of NANP numbers 
assigned to wireless devices, we conclude that those rules are 
supported by our exclusive numbering authority within Section 251(e).
    78. Number Porting. We rely on our authority derived from Sections 
1, 2, 4(i), 251(e), and 332 of the Act to implement the changes to our 
number porting rules to address port-out fraud. As the Commission has 
consistently found since 1996, ``[w]e possess independent authority 
under Sections 1, 2, 4(i), and 332 of the Communications Act of 1934, 
as amended, to require CMRS providers to provide number portability as 
we deem appropriate.'' We rely on this well-established authority to 
adopt number porting rules applicable to wireless providers that 
address port-out fraud.
    79. We also find that the exclusive numbering authority that 
Congress granted this Commission under Section 251(e)(1) provides ample 
authority to extend the LNP requirements as set out in this Report and 
Order. Specifically, in Section 251(e)(1) of the Act, Congress 
expressly assigned to the Commission exclusive jurisdiction over that 
portion of the NANP that pertains to the United States and related 
telephone numbering issues. The Commission retained its ``authority to 
set policy with respect to all facets of numbering administration in 
the United States.'' We find that the revisions to our number porting 
rules designed to protect the customers from port-out fraud fit 
comfortably within our exclusive numbering authority because the 
requirements we establish to prevent and promptly resolve port-out 
fraud are necessary to address improper use of numbering resources and 
ensure that customers can recover their numbers when fraudulent ports 
have occurred.
    80. Other Sources of Authority. While the provisions discussed 
above provide sufficient authority for the entirety of the rules we 
adopt in this Report and Order, we find additional support under 
Sections 201 and 303. Sections 201 and 303 of the Act generally give 
the Commission authority for prescribing rules, but we also rely on 
these sources of authority as described herein.
    81. Section 201(b) authorizes the Commission to prescribe rules to 
implement carriers' statutory duty not to engage in conduct that is 
``unjust or unreasonable.'' We conclude that practices that allow for 
fraudulent SIM swaps and number ports are unjust and unreasonable 
because they are contrary to the reasonable expectations of customers, 
are not reasonably avoidable by customers, and can cause substantial 
customer harm. We also rely on our Section 201(b) authority to find 
that the inability for customers to effectively seek remedies from 
their wireless providers when fraudulent SIM swaps and port outs have 
occurred is ``unjust and unreasonable,'' and therefore warrants these 
rules. We would also find these practices unjust and unreasonable when 
a wireless provider says it will implement reasonable measures to 
prevent fraudulent SIM swaps and number ports but fails to do so. Our 
findings here are similar to and consistent with how the Federal Trade 
Commission (FTC) addresses inadequate data security measures under 
Section 5 of the FTC Act.
    82. We also rely on our broad authority under Title III, which 
allows us to protect the public interest through spectrum licensing. 
Pursuant to Section 303(b)'s directive that the Commission must, 
consistent with the public interest, ``[p]rescribe the nature of the 
service to be rendered by each class of licensed stations and each 
station within any class,'' these revisions to our CPNI and number 
porting requirements prescribe the conditions under which licensed 
wireless providers must provide their services. They specifically 
require licensed wireless providers to provide their services in a way 
that protects the interests of their customers, including reasonable 
measures to prevent fraudulent acts against their customers.

II. Procedural Matters

    83. Regulatory Flexibility Act. The Regulatory Flexibility Act of 
1980, as amended (RFA) requires that an agency prepare a regulatory 
flexibility analysis for notice and comment rulemakings, unless the 
agency certifies that ``the rule will not, if promulgated, have a 
significant economic impact on a substantial number of small 
entities.'' Accordingly, the Commission has prepared a Final Regulatory 
Flexibility Analysis (FRFA) concerning the potential impact of the rule 
and policy

[[Page 85809]]

changes adopted in this Report and Order on small entities. The FRFA is 
set forth in Appendix B.
    84. Congressional Review Act. The Commission has determined, and 
the Administrator of the Office of Information and Regulatory Affairs, 
Office of Management and Budget, concurs, that this rule is ``non-
major'' under the Congressional Review Act, 5 U.S.C. 804(2). The 
Commission will send a copy of this Report and Order to Congress and 
the Government Accountability Office pursuant to 5 U.S.C. 801(a)(1)(A).

III. Final Regulatory Flexibility Analysis

    85. As required by the Regulatory Flexibility Act of 1980, as 
amended (RFA), an Initial Regulatory Flexibility Analysis (IRFA) was 
incorporated into the Protecting Consumers from SIM Swap and Port-Out 
Fraud Notice of Proposed Rulemaking (SIM Swap and Port-Out Fraud) 
published October 15, 2021 at 86 FR 57390. The Commission sought 
written public comment on the proposals in the SIM Swap and Port-Out 
Fraud Notice, including comment on the IRFA. The comments received are 
discussed below. This Final Regulatory Flexibility Analysis (FRFA) 
conforms to the RFA.

A. Need for, and Objectives of, the Report and Order

    86. The Report and Order establishes protections to address SIM 
swap and port-out fraud. With SIM swap fraud, a bad actor impersonates 
a customer of a wireless provider and convinces the provider to 
reassign the customer's SIM from the customer's device to a device 
controlled by the bad actor. Similarly, with port-out fraud, the bad 
actor impersonates a customer of a wireless provider and convinces the 
provider to port the customer's telephone number to a new wireless 
provider and a device that the bad actor controls. Both fraudulent 
practices transfer the victim's wireless service to the bad actor, 
allow the bad actor to gain access to information associated with the 
customer's account, and permit the bad actor to receive the text 
messages and phone calls intended for the customer.
    87. The rules adopted in the Report and Order aim to foreclose 
these fraudulent practices while preserving the relative ease with 
which customers can obtain legitimate SIM changes and number ports. 
Specifically, the Report and Order revises the Commission's CPNI and 
LNP rules to require that wireless providers use secure methods of 
authenticating customers prior to performing SIM changes and number 
ports. This requirement is reinforced by other rules, including that 
wireless providers adopt processes for responding to failed 
authentication attempts, institute employee training for handling SIM 
swap and port-out fraud, and establish safeguards to prevent employees 
who receive inbound customer communications are unable to access CPNI 
in the course of that customer interaction until after customers have 
been authenticated. The Report and Order also adopts rules that will 
enable customers to act to prevent and address fraudulent SIM changes 
and number ports, including requiring that wireless providers notify 
customers regarding SIM change and port-out requests, offer customers 
the option to lock their accounts to block processing of SIM changes 
and number ports, and give advanced notice of available account 
protection mechanisms. Additionally, the Report and Order establishes 
requirements to minimize the harms of SIM swap and port-out fraud when 
it occurs, including requiring wireless providers to maintain a clear 
process for customers to report fraud, promptly investigate and 
remediate fraud, and promptly provide customers with documentation of 
fraud involving their accounts. Finally, to ensure wireless providers 
track the effectiveness of authentication measures used for SIM change 
requests, the Report and Order requires that providers keep records of 
SIM change requests and the authentication measures they use.

B. Summary of Significant Issues Raised by Public Comments in Response 
to the IRFA

    88. There were no comments that directly addressed the proposed 
rules and policies presented in the SIM Swap and Port-Out Fraud Notice 
IRFA. However two commenters discussed the potential impact of rules on 
small carriers. The Competitive Carriers Association (CCA) advocated 
that the Commission adopt security measures that give providers 
flexibility to account for the constraints with which many small 
providers operate. The Rural Wireless Association (RWA) called for 
uniform standards for port-out authentication to prevent potential 
anticompetitive activities and increased costs for small providers in 
the event that larger providers hold small providers to standards that 
are difficult or costly to implement. The approach taken by the Report 
and Order addresses these comments by setting baseline requirements 
that build on existing mechanisms that many wireless providers already 
use to establish a uniform framework across the mobile wireless 
industry, while giving wireless providers the flexibility to deliver 
the most advanced, appropriate, and cost-effective fraud protection 
measures available.

C. Response to Comments by the Chief Counsel for Advocacy of the Small 
Business Administration

    89. Pursuant to the Small Business Jobs Act of 2010, which amended 
the RFA, the Commission is required to respond to any comments filed by 
the Chief Counsel for Advocacy of the Small Business Administration 
(SBA), and to provide a detailed statement of any change made to the 
proposed rules as a result of those comments. The Chief Counsel did not 
file any comments in response to the proposed rules in this proceeding.

D. Description and Estimate of the Number of Small Entities to Which 
the Rules Will Apply

    90. The RFA directs agencies to provide a description of, and where 
feasible, an estimate of the number of small entities that may be 
affected by the rules adopted herein. The RFA generally defines the 
term ``small entity'' as having the same meaning as the terms ``small 
business,'' ``small organization,'' and ``small governmental 
jurisdiction.'' In addition, the term ``small business'' has the same 
meaning as the term ``small business concern'' under the Small Business 
Act. A ``small business concern'' is one which: (1) is independently 
owned and operated; (2) is not dominant in its field of operation; and 
(3) satisfies any additional criteria established by the SBA.
    91. Small Businesses, Small Organizations, Small Governmental 
Jurisdictions. Our actions, over time, may affect small entities that 
are not easily categorized at present. We therefore describe, at the 
outset, three broad groups of small entities that could be directly 
affected herein. First, while there are industry specific size 
standards for small businesses that are used in the regulatory 
flexibility analysis, according to data from the Small Business 
Administration's (SBA) Office of Advocacy, in general a small business 
is an independent business having fewer than 500 employees. These types 
of small businesses represent 99.9% of all businesses in the United 
States, which translates to 33.2 million businesses.
    92. Next, the type of small entity described as a ``small 
organization'' is generally ``any not-for-profit enterprise which is 
independently owned and operated and is not dominant in its

[[Page 85810]]

field.'' The Internal Revenue Service (IRS) uses a revenue benchmark of 
$50,000 or less to delineate its annual electronic filing requirements 
for small exempt organizations. Nationwide, for tax year 2020, there 
were approximately 447,689 small exempt organizations in the U.S. 
reporting revenues of $50,000 or less according to the registration and 
tax data for exempt organizations available from the IRS.
    93. Finally, the small entity described as a ``small governmental 
jurisdiction'' is defined generally as ``governments of cities, 
counties, towns, townships, villages, school districts, or special 
districts, with a population of less than fifty thousand.'' U.S. Census 
Bureau data from the 2017 Census of Governments indicate there were 
90,075 local governmental jurisdictions consisting of general purpose 
governments and special purpose governments in the United States. Of 
this number, there were 36,931 general purpose governments (county, 
municipal, and town or township) with populations of less than 50,000 
and 12,040 special purpose governments--independent school districts 
with enrollment populations of less than 50,000. Accordingly, based on 
the 2017 U.S. Census of Governments data, we estimate that at least 
48,971 entities fall into the category of ``small governmental 
jurisdictions.''
1. Providers of Telecommunications and Other Services
    94. Wired Telecommunications Carriers. The U.S. Census Bureau 
defines this industry as establishments primarily engaged in operating 
and/or providing access to transmission facilities and infrastructure 
that they own and/or lease for the transmission of voice, data, text, 
sound, and video using wired communications networks. Transmission 
facilities may be based on a single technology or a combination of 
technologies. Establishments in this industry use the wired 
telecommunications network facilities that they operate to provide a 
variety of services, such as wired telephony services, including VoIP 
services, wired (cable) audio and video programming distribution, and 
wired broadband internet services. By exception, establishments 
providing satellite television distribution services using facilities 
and infrastructure that they operate are included in this industry. 
Wired Telecommunications Carriers are also referred to as wireline 
carriers or fixed local service providers.
    95. The SBA small business size standard for Wired 
Telecommunications Carriers classifies firms having 1,500 or fewer 
employees as small. U.S. Census Bureau data for 2017 show that there 
were 3,054 firms that operated in this industry for the entire year. Of 
this number, 2,964 firms operated with fewer than 250 employees. 
Additionally, based on Commission data in the 2022 Universal Service 
Monitoring Report, as of December 31, 2021, there were 4,590 providers 
that reported they were engaged in the provision of fixed local 
services. Of these providers, the Commission estimates that 4,146 
providers have 1,500 or fewer employees. Consequently, using the SBA's 
small business size standard, most of these providers can be considered 
small entities.
    96. Local Exchange Carriers (LECs). Neither the Commission nor the 
SBA has developed a size standard for small businesses specifically 
applicable to local exchange services. Providers of these services 
include both incumbent and competitive local exchange service 
providers. Wired Telecommunications Carriers is the closest industry 
with an SBA small business size standard. Wired Telecommunications 
Carriers are also referred to as wireline carriers or fixed local 
service providers. The SBA small business size standard for Wired 
Telecommunications Carriers classifies firms having 1,500 or fewer 
employees as small. U.S. Census Bureau data for 2017 show that there 
were 3,054 firms that operated in this industry for the entire year. Of 
this number, 2,964 firms operated with fewer than 250 employees. 
Additionally, based on Commission data in the 2022 Universal Service 
Monitoring Report, as of December 31, 2021, there were 4,590 providers 
that reported they were fixed local exchange service providers. Of 
these providers, the Commission estimates that 4,146 providers have 
1,500 or fewer employees. Consequently, using the SBA's small business 
size standard, most of these providers can be considered small 
entities.
    97. Incumbent Local Exchange Carriers (Incumbent LECs). Neither the 
Commission nor the SBA have developed a small business size standard 
specifically for incumbent local exchange carriers. Wired 
Telecommunications Carriers is the closest industry with an SBA small 
business size standard. The SBA small business size standard for Wired 
Telecommunications Carriers classifies firms having 1,500 or fewer 
employees as small. U.S. Census Bureau data for 2017 show that there 
were 3,054 firms in this industry that operated for the entire year. Of 
this number, 2,964 firms operated with fewer than 250 employees. 
Additionally, based on Commission data in the 2022 Universal Service 
Monitoring Report, as of December 31, 2021, there were 1,212 providers 
that reported they were incumbent local exchange service providers. Of 
these providers, the Commission estimates that 916 providers have 1,500 
or fewer employees. Consequently, using the SBA's small business size 
standard, the Commission estimates that the majority of incumbent local 
exchange carriers can be considered small entities.
    98. Competitive Local Exchange Carriers (Competitive LECs). Neither 
the Commission nor the SBA has developed a size standard for small 
businesses specifically applicable to local exchange services. 
Providers of these services include several types of competitive local 
exchange service providers. Wired Telecommunications Carriers is the 
closest industry with an SBA small business size standard. The SBA 
small business size standard for Wired Telecommunications Carriers 
classifies firms having 1,500 or fewer employees as small. U.S. Census 
Bureau data for 2017 show that there were 3,054 firms that operated in 
this industry for the entire year. Of this number, 2,964 firms operated 
with fewer than 250 employees. Additionally, based on Commission data 
in the 2022 Universal Service Monitoring Report, as of December 31, 
2021, there were 3,378 providers that reported they were competitive 
local exchange service providers. Of these providers, the Commission 
estimates that 3,230 providers have 1,500 or fewer employees. 
Consequently, using the SBA's small business size standard, most of 
these providers can be considered small entities.
    99. Interexchange Carriers (IXCs). Neither the Commission nor the 
SBA have developed a small business size standard specifically for 
Interexchange Carriers. Wired Telecommunications Carriers is the 
closest industry with an SBA small business size standard. The SBA 
small business size standard for Wired Telecommunications Carriers 
classifies firms having 1,500 or fewer employees as small. U.S. Census 
Bureau data for 2017 show that there were 3,054 firms that operated in 
this industry for the entire year. Of this number, 2,964 firms operated 
with fewer than 250 employees. Additionally, based on Commission data 
in the 2022 Universal Service Monitoring Report, as of December 31, 
2021, there were 127 providers that reported they were engaged in the 
provision of interexchange services. Of these

[[Page 85811]]

providers, the Commission estimates that 109 providers have 1,500 or 
fewer employees. Consequently, using the SBA's small business size 
standard, the Commission estimates that the majority of providers in 
this industry can be considered small entities.
    100. Local Resellers. Neither the Commission nor the SBA have 
developed a small business size standard specifically for Local 
Resellers. Telecommunications Resellers is the closest industry with an 
SBA small business size standard. The Telecommunications Resellers 
industry comprises establishments engaged in purchasing access and 
network capacity from owners and operators of telecommunications 
networks and reselling wired and wireless telecommunications services 
(except satellite) to businesses and households. Establishments in this 
industry resell telecommunications; they do not operate transmission 
facilities and infrastructure. Mobile virtual network operators (MVNOs) 
are included in this industry. The SBA small business size standard for 
Telecommunications Resellers classifies a business as small if it has 
1,500 or fewer employees. U.S. Census Bureau data for 2017 show that 
1,386 firms in this industry provided resale services for the entire 
year. Of that number, 1,375 firms operated with fewer than 250 
employees. Additionally, based on Commission data in the 2022 Universal 
Service Monitoring Report, as of December 31, 2021, there were 207 
providers that reported they were engaged in the provision of local 
resale services. Of these providers, the Commission estimates that 202 
providers have 1,500 or fewer employees. Consequently, using the SBA's 
small business size standard, most of these providers can be considered 
small entities.
    101. Toll Resellers. Neither the Commission nor the SBA have 
developed a small business size standard specifically for Toll 
Resellers. Telecommunications Resellers is the closest industry with an 
SBA small business size standard. The Telecommunications Resellers 
industry comprises establishments engaged in purchasing access and 
network capacity from owners and operators of telecommunications 
networks and reselling wired and wireless telecommunications services 
(except satellite) to businesses and households. Establishments in this 
industry resell telecommunications; they do not operate transmission 
facilities and infrastructure. Mobile virtual network operators (MVNOs) 
are included in this industry. The SBA small business size standard for 
Telecommunications Resellers classifies a business as small if it has 
1,500 or fewer employees. U.S. Census Bureau data for 2017 show that 
1,386 firms in this industry provided resale services for the entire 
year. Of that number, 1,375 firms operated with fewer than 250 
employees. Additionally, based on Commission data in the 2022 Universal 
Service Monitoring Report, as of December 31, 2021, there were 457 
providers that reported they were engaged in the provision of toll 
services. Of these providers, the Commission estimates that 438 
providers have 1,500 or fewer employees. Consequently, using the SBA's 
small business size standard, most of these providers can be considered 
small entities.
    102. Wireless Telecommunications Carriers (except Satellite). This 
industry comprises establishments engaged in operating and maintaining 
switching and transmission facilities to provide communications via the 
airwaves. Establishments in this industry have spectrum licenses and 
provide services using that spectrum, such as cellular services, paging 
services, wireless internet access, and wireless video services. The 
SBA size standard for this industry classifies a business as small if 
it has 1,500 or fewer employees. U.S. Census Bureau data for 2017 show 
that there were 2,893 firms in this industry that operated for the 
entire year. Of that number, 2,837 firms employed fewer than 250 
employees. Additionally, based on Commission data in the 2022 Universal 
Service Monitoring Report, as of December 31, 2021, there were 594 
providers that reported they were engaged in the provision of wireless 
services. Of these providers, the Commission estimates that 511 
providers have 1,500 or fewer employees. Consequently, using the SBA's 
small business size standard, most of these providers can be considered 
small entities.
    103. Satellite Telecommunications. This industry comprises firms 
``primarily engaged in providing telecommunications services to other 
establishments in the telecommunications and broadcasting industries by 
forwarding and receiving communications signals via a system of 
satellites or reselling satellite telecommunications.'' Satellite 
telecommunications service providers include satellite and earth 
station operators. The SBA small business size standard for this 
industry classifies a business with $38.5 million or less in annual 
receipts as small. U.S. Census Bureau data for 2017 show that 275 firms 
in this industry operated for the entire year. Of this number, 242 
firms had revenue of less than $25 million. Additionally, based on 
Commission data in the 2022 Universal Service Monitoring Report, as of 
December 31, 2021, there were 65 providers that reported they were 
engaged in the provision of satellite telecommunications services. Of 
these providers, the Commission estimates that approximately 42 
providers have 1,500 or fewer employees. Consequently, using the SBA's 
small business size standard, a little more than half of these 
providers can be considered small entities.
    104. All Other Telecommunications. This industry is comprised of 
establishments primarily engaged in providing specialized 
telecommunications services, such as satellite tracking, communications 
telemetry, and radar station operation. This industry also includes 
establishments primarily engaged in providing satellite terminal 
stations and associated facilities connected with one or more 
terrestrial systems and capable of transmitting telecommunications to, 
and receiving telecommunications from, satellite systems. Providers of 
internet services (e.g., dial-up ISPs) or Voice over Internet Protocol 
(VoIP) services, via client-supplied telecommunications connections are 
also included in this industry. The SBA small business size standard 
for this industry classifies firms with annual receipts of $35 million 
or less as small. U.S. Census Bureau data for 2017 show that there were 
1,079 firms in this industry that operated for the entire year. Of 
those firms, 1,039 had revenue of less than $25 million. Based on this 
data, the Commission estimates that the majority of ``All Other 
Telecommunications'' firms can be considered small.
2. Internet Service Providers
    105. Wired Broadband Internet Access Service Providers (Wired 
ISPs). Providers of wired broadband internet access service include 
various types of providers except dial-up internet access providers. 
Wireline service that terminates at an end user location or mobile 
device and enables the end user to receive information from and/or send 
information to the internet at information transfer rates exceeding 200 
kilobits per second (kbps) in at least one direction is classified as a 
broadband connection under the Commission's rules. Wired broadband 
internet services fall in the Wired Telecommunications Carriers 
industry. The SBA small business size standard for this industry 
classifies firms having 1,500 or fewer employees as small. U.S. Census 
Bureau

[[Page 85812]]

data for 2017 show that there were 3,054 firms that operated in this 
industry for the entire year. Of this number, 2,964 firms operated with 
fewer than 250 employees.
    106. Additionally, according to Commission data on internet access 
services as of December 31, 2018, nationwide there were approximately 
2,700 providers of connections over 200 kbps in at least one direction 
using various wireline technologies. The Commission does not collect 
data on the number of employees for providers of these services, 
therefore, at this time we are not able to estimate the number of 
providers that would qualify as small under the SBA's small business 
size standard. However, in light of the general data on fixed 
technology service providers in the Commission's 2022 Communications 
Marketplace Report, we believe that the majority of wireline internet 
access service providers can be considered small entities.
    107. Wireless Broadband Internet Access Service Providers (Wireless 
ISPs or WISPs). Providers of wireless broadband internet access service 
include fixed and mobile wireless providers. The Commission defines a 
WISP as ``[a] company that provides end-users with wireless access to 
the internet[.]'' Wireless service that terminates at an end user 
location or mobile device and enables the end user to receive 
information from and/or send information to the internet at information 
transfer rates exceeding 200 kilobits per second (kbps) in at least one 
direction is classified as a broadband connection under the 
Commission's rules. Neither the SBA nor the Commission have developed a 
size standard specifically applicable to Wireless Broadband Internet 
Access Service Providers. The closest applicable industry with an SBA 
small business size standard is Wireless Telecommunications Carriers 
(except Satellite). The SBA size standard for this industry classifies 
a business as small if it has 1,500 or fewer employees. U.S. Census 
Bureau data for 2017 show that there were 2,893 firms in this industry 
that operated for the entire year. Of that number, 2,837 firms employed 
fewer than 250 employees.
    108. Additionally, according to Commission data on internet access 
services as of December 31, 2018, nationwide there were approximately 
1,209 fixed wireless and 71 mobile wireless providers of connections 
over 200 kbps in at least one direction. The Commission does not 
collect data on the number of employees for providers of these 
services, therefore, at this time we are not able to estimate the 
number of providers that would qualify as small under the SBA's small 
business size standard. However, based on data in the Commission's 2022 
Communications Marketplace Report on the small number of large mobile 
wireless nationwide and regional facilities-based providers, the dozens 
of small regional facilities-based providers and the number of wireless 
mobile virtual network providers in general, as well as on terrestrial 
fixed wireless broadband providers in general, we believe that the 
majority of wireless internet access service providers can be 
considered small entities.
    109. Internet Service Providers (Non-Broadband). Internet access 
service providers using client-supplied telecommunications connections 
(e.g., dial-up ISPs) as well as VoIP service providers using client-
supplied telecommunications connections fall in the industry 
classification of All Other Telecommunications. The SBA small business 
size standard for this industry classifies firms with annual receipts 
of $35 million or less as small. For this industry, U.S. Census Bureau 
data for 2017 show that there were 1,079 firms in this industry that 
operated for the entire year. Of those firms, 1,039 had revenue of less 
than $25 million. Consequently, under the SBA size standard a majority 
of firms in this industry can be considered small.

E. Description of Projected Reporting, Recordkeeping, and Other 
Compliance Requirements for Small Entities

    110. This Report and Order adopts rules that could result in 
increased, reduced, or otherwise modified recordkeeping, reporting, or 
other compliance requirements for affected providers of service, 
including small wireless providers. Specifically, it requires that 
wireless providers use secure methods of authenticating customers prior 
to performing SIM changes and number ports, and to review and update 
these authentication methods as needed, but at least annually. It 
requires wireless providers to adopt processes for customer 
notification and response to failed authentication attempts, institute 
employee training for handling SIM swap and port-out fraud, and 
establish safeguards to prevent employees who receive inbound customer 
communications from accessing CPNI in the course of that customer 
interaction until after customers have been authenticated. The Report 
and Order also adopts rules requiring that wireless providers notify 
customers regarding SIM change and port-out requests, offer customers 
the option to lock their accounts to block processing of SIM changes 
and number ports, and give advanced notice of available account 
protection mechanisms. Additionally, the Report and Order requires 
wireless providers to maintain a clear process for customers to report 
fraud, promptly investigate and remediate fraud, and promptly provide 
customers with documentation of fraud involving their accounts. 
Finally, the Report and Order requires that providers keep records of 
SIM change requests and the authentication measures they use.
    111. We are cognizant that, in some instances, strict prescriptive 
requirements to prevent SIM swap and port-out fraud could be 
technically and economically infeasible for wireless providers to 
implement, particularly for smaller providers. The Commission does not 
have sufficient information on the record to determine whether small 
entities will be required to hire professionals to comply with its 
decisions or to quantify the cost of compliance for small entities. 
However, the record reflects that many wireless providers have already 
developed and implemented some form of the customer authentication 
requirements in the Report and Order, minimizing cost implications for 
small entities. We also permit wireless providers to use existing 
methods of notification that are reasonably designed to reach the 
affected customer. Several of our rules build on existing mechanisms 
that many wireless providers already use, and therefore, we expect that 
our new rules will further minimize the costs and burdens for those 
providers, and should significantly reduce compliance requirements for 
small entities that may have smaller staff and fewer resources.

F. Steps Taken To Minimize the Significant Economic Impact on Small 
Entities, and Significant Alternatives Considered

    112. The RFA requires an agency to provide ``a description of the 
steps the agency has taken to minimize the significant economic impact 
on small entities . . . including a statement of the factual, policy, 
and legal reasons for selecting the alternative adopted in the final 
rule and why each one of the other significant alternatives to the rule 
considered by the agency which affect the impact on small entities was 
rejected.''
    113. The requirements established in this Report and Order are 
designed to minimize the economic impact on wireless providers, 
including small providers. The baseline, flexible rules adopted reflect 
a recognition that, in some cases, strict prescriptive

[[Page 85813]]

requirements to prevent SIM swap and port-out fraud could be 
technically and economically infeasible for wireless providers to 
implement, particularly for smaller providers. We therefore decline to 
adopt certain specific authentication methods mentioned in the SIM Swap 
and Port-Out Fraud Notice because they may discourage carriers from 
adopting new methods to address evolving techniques used by bad actors. 
The record shows that many wireless providers already have in place 
some of the policies and procedures this Report and Order adopts and 
that the rules may therefore only require them to adapt, refine, or 
consistently apply those existing practices. Additionally, by setting 
baseline requirements and giving wireless providers flexibility on how 
to meet them, this Report and Order allows providers to adopt the most 
cost-effective and least burdensome solutions to achieve the level of 
security needed to protect customers against SIM swap and port-out 
fraud in a given circumstance. The Report and Order further minimizes 
any potential burdens of customer notifications by declining to 
prescribe particular content and wording and giving wireless providers 
flexibility on how to deliver such notifications. Similarly, for 
customer notices, the Report and Order declines to require a specific 
format and content and declines to require such notices be delivered to 
customers annually. With respect to employee training, we decline to 
adopt overly prescriptive safeguards, such as two-employee sign off. 
Instead, the requirement this Report and Order adopts minimizes 
potential burdens because it builds on the Commission's existing CPNI 
training rule and gives wireless providers flexibility on how to 
develop their training programs. Further, the Report and Order 
mitigates the potential burdens of the recordkeeping requirement by 
declining to require that wireless providers include historic data in 
their recordkeeping, which the Report and Order acknowledged would be 
particularly burdensome for small providers, and declining to require 
that providers report this data to the Commission regularly.

G. Report to Congress

    114. The Commission will send a copy of the SIM Swap and Port-Out 
Fraud Report and Order, including this FRFA, in a report to be sent to 
Congress pursuant to the Congressional Review Act. In addition, the 
Commission will send a copy of the SIM Swap and Port-Out Fraud Report 
and Order, including this FRFA, to the Chief Counsel for Advocacy of 
the SBA. A copy of the SIM Swap and Port-Out Fraud Report and Order (or 
summaries thereof) will also be published in the Federal Register.

IV. Ordering Clauses

    115. Accordingly, it is ordered that, pursuant to the authority 
contained in Sections 1, 2, 4, 201, 222, 251, 303, and 332 of the 
Communications Act of 1934, as amended, 47 U.S.C. 151, 152, 154, 201, 
222, 251, 303, and 332, this Report and Order in WC Docket No. 21-341 
is adopted and that Parts 52 and 64 of the Commission's Rules, 47 CFR 
parts 52, 64, are amended as set forth in Appendix A.
    116. It is further ordered that this Report and Order shall be 
effective 30 days after publication in the Federal Register, and that 
compliance with the rules adopted herein shall be required six months 
after the effective date of the Report and Order, except that the 
amendments to Sections 52.37(c), 52.37(d), 52.37(e), 52.37(g), 
64.2010(h)(2), 64.2010(h)(3), 64.2010(h)(4), 64.2010(h)(5), 
64.2010(h)(6), and 64.2010(h)(8) of the Commission's rules, 47 CFR 
52.37(c), 52.37(d), 52.37(e), 52.37(g), 64.2010(h)(2), 64.2010(h)(3), 
64.2010(h)(4), 64.2010(h)(5), 64.2010(h)(6), and 64.2010(h)(8), which 
may contain new or modified information collection requirements, will 
not become effective until the later of (i) six months after the 
effective date of this Report and Order; or (ii) after the Office of 
Management and Budget completes review of any information collection 
requirements associated with this Report and Order that the Wireline 
Competition Bureau determines is required under the Paperwork Reduction 
Act. The Commission directs the Wireline Competition Bureau to announce 
the compliance date for Sec. Sec.  52.37(c), 52.37(d), 52.37(e), 
52.37(g), 64.2010(h)(2), 64.2010(h)(3), 64.2010(h)(4), 64.2010(h)(5), 
64.2010(h)(6), and 64.2010(h)(8) and to amend 47 CFR 52.37 and 64.2010 
accordingly.
    117. It is further ordered that the Commission's Office of the 
Secretary, Reference Information Center, shall send a copy of this 
Report and Order, including the Final Regulatory Flexibility Analysis, 
to the Chief Counsel for Advocacy of the Small Business Administration.
    118. It is further ordered that the Office of the Managing 
Director, Performance and Program Management, shall send a copy of this 
Report and Order in a report to be sent to Congress and the Government 
Accountability Office pursuant to the Congressional Review Act, see 5 
U.S.C. 801(a)(1)(A).

List of Subjects

    Communications, Communications common carriers, Privacy, 
Telecommunications, Telephone, Reporting and Recordkeeping 
Requirements.

Federal Communications Commission.
Marlene Dortch,
Secretary.

Final Rules

    For the reasons discussed in the preamble, the Federal 
Communications Commission amends 47 CFR parts 52 and 64 as follows:

PART 52--NUMBERING

0
1. The authority citation for part 52 continues to read as follows:

    Authority:  47 U.S.C. 151, 152, 153, 154, 155, 201-205, 207-209, 
218, 225-227, 251-252, 271, 303, 332, unless otherwise noted.


0
2. Add Sec.  52.37 to subpart C to read as follows:


Sec.  52.37  Number Portability Requirements for Wireless Providers.

    (a) Applicability. This section applies to all providers of 
commercial mobile radio service (CMRS), as defined in 47 CFR 20.3, 
including resellers of wireless service.
    (b) Authentication of port-out requests. A CMRS provider shall use 
secure methods to authenticate a customer that are reasonably designed 
to confirm the customer's identity before effectuating a port-out 
request, except to the extent otherwise required by 47 U.S.C. 345 (Safe 
Connections Act of 2022) or Part 64 Subpart II of this chapter. A CMRS 
provider shall regularly, but not less than annually, review and, as 
necessary, update its customer authentication methods to ensure that 
its authentication methods continue to be secure.
    (c)-(e) [Reserved]
    (f) Employee Training. A CMRS provider shall develop and implement 
training for employees to specifically address fraudulent port-out 
attempts, complaints, and remediation. Training shall include, at a 
minimum, how to identify fraudulent requests, how to recognize when a 
customer may be the victim of fraud, and how to direct potential 
victims and individuals making potentially fraudulent requests to 
employees specifically trained to handle such incidents.
    (g) [Reserved]
    (h) This section contains information-collection and/or 
recordkeeping requirements. Compliance with this section will not be 
required until this paragraph is removed or contains a compliance date.

[[Page 85814]]


0
3. Delayed indefinitely, amend Sec.  52.37 by adding paragraphs (c), 
(d), (e), and (g) to read as follows:


Sec.  52.37  Number Portability Requirements for Wireless Providers.

    (c) Customer notification of port-out requests. Upon receiving a 
port-out request, and before effectuating the request, a CMRS provider 
shall provide immediate notification to the customer that a port-out 
request associated with the customer's account was made, sent in 
accordance with customer preferences, if indicated, and using means 
reasonably designed to reach the customer associated with the account 
and clear and concise language that provides sufficient information to 
effectively inform a customer that a port-out request involving the 
customer's number was made, except if the port-out request was made in 
connection with a legitimate line separation request pursuant to 47 
U.S.C. 345 and subpart II of this part, regardless of whether the line 
separation is technically or operationally feasible.
    (d) Account locks. A CMRS provider shall offer customers, at no 
cost, the option to lock their accounts to prohibit the CMRS provider 
from processing requests to port the customer's number. A CMRS provider 
shall not fulfill a port-out request until the customer deactivates the 
lock on the account, except if the port-out request was made in 
connection with a legitimate line separation request pursuant to 47 
U.S.C. 345 and subpart II of this part, regardless of whether the line 
separation is technically or operationally feasible. The process to 
activate and deactivate an account lock must not be unduly burdensome 
for customers such that it effectively inhibits customers from 
implementing their choice. A CMRS provider may activate a port-out lock 
on a customer's account when the CMRS provider has a reasonable belief 
that the customer is at high risk of fraud, but must provide the 
customer with clear notification that the account lock has been 
activated with instructions on how the customer can deactivate the 
account lock, and promptly comply with the customer's legitimate 
request to deactivate the account lock.
    (e) Notice of Account Protection Measures. A CMRS provider must 
provide customers with notice, using clear and concise language, of any 
account protection measures the CMRS provider offers, including those 
to prevent port-out fraud. A CMRS provider shall make this notice 
easily accessible through the CMRS provider's website and application.
* * * * *
    (g) Procedures to resolve fraudulent ports. A CMRS provider shall, 
at no cost to customers:
    (1) Maintain a clearly disclosed, transparent, and easy-to-use 
process for customers to report fraudulent number ports;
    (2) Promptly investigate and take reasonable steps within its 
control to remediate fraudulent number ports; and
    (3) Promptly provide customers, upon request, with documentation of 
fraudulent number ports involving their accounts.

PART 64--MISCELLANEOUS RULES RELATING TO COMMON CARRIERS

0
4. The authority citation for part 64 continues to read as follows:

    Authority:  47 U.S.C. 151, 152, 154, 201, 202, 217, 218, 220, 
222, 225, 226, 227, 227b, 228, 251(a), 251(e), 254(k), 262, 276, 
303, 332, 403(b)(2)(B), (c), 616, 620, 1004, 1401-1473, unless 
otherwise noted; Pub. L. 115-141, Div. P, sec. 503, 132 Stat. 348, 
1091.


0
5. Amend Sec.  64.2010 by adding paragraph (h) to read as follows:


Sec.  64.2010  Safeguards on the disclosure of customer proprietary 
network information.

* * * * *
    (h) Subscriber Identity Module (SIM) changes. A provider of 
commercial mobile radio service (CMRS), as defined in 47 CFR 20.3, 
including resellers of wireless service, shall only effectuate SIM 
change requests in accordance with this section. For purposes of this 
section, SIM means a physical or virtual card associated with a device 
that stores unique information that can be identified to a specific 
mobile network.
    (1) Customer authentication. A CMRS provider shall use secure 
methods to authenticate a customer that are reasonably designed to 
confirm the customer's identity before executing a SIM change request, 
except to the extent otherwise required by 47 U.S.C. 345 (Safe 
Connections Act of 2022) or subpart II of this part. Authentication 
methods shall not rely on readily available biographical information, 
account information, recent payment information, or call detail 
information unless otherwise permitted under 47 U.S.C. 345 or subpart 
II of this part. A CMRS provider shall regularly, but not less than 
annually, review and, as necessary, update its customer authentication 
methods to ensure that its authentication methods continue to be 
secure. A CMRS provider shall establish safeguards and processes so 
that employees who receive inbound customer communications are unable 
to access CPNI in the course of that customer interaction until after 
the customer has been properly authenticated.
    (2)-(6) [Reserved]
    (7) Employee training. A CMRS provider shall develop and implement 
training for employees to specifically address fraudulent SIM change 
attempts, complaints, and remediation. Training shall include, at a 
minimum, how to identify potentially fraudulent SIM change requests, 
how to identify when a customer may be the victim of SIM swap fraud, 
and how to direct potential victims and individuals making potentially 
fraudulent requests to employees specifically trained to handle such 
incidents.
    (8) [Reserved]
    (9) Compliance. This paragraph (h) contains information-collection 
and/or recordkeeping requirements. Compliance with this paragraph (h) 
will not be required until this paragraph is removed or contains a 
compliance date.

0
6. Delayed indefinitely, amend Sec.  64.2010 by adding paragraphs 
(h)(2) through (6) and (h)(8) to read as follows:


Sec.  64.2010  Safeguards on the disclosure of customer proprietary 
network information.

* * * * *
    (h) * * *
    (2) Response to failed authentication attempts. A CMRS provider 
shall develop, maintain, and implement procedures for addressing failed 
authentication attempts in connection with a SIM change request that 
are reasonably designed to prevent unauthorized access to a customer's 
account, which, among other things, take into consideration the needs 
of survivors pursuant to 47 U.S.C. 345 and subpart II of this part.
    (3) Customer notification of SIM change requests. Upon receiving a 
SIM change request, and before effectuating the request, a CMRS 
provider shall provide immediate notification to the customer that a 
SIM change request associated with the customer's account was made, 
sent in accordance with customer preferences, if indicated, and using 
means reasonably designed to reach the customer associated with the 
account and clear and concise language that provides sufficient 
information to effectively inform a customer that a SIM change request 
involving the customer's SIM was made, except if the SIM change request 
was made in connection with a legitimate line separation request 
pursuant to 47 U.S.C. 345 and subpart II of this part, regardless of 
whether the line separation is technically or operationally feasible.
    (4) Account locks. A CMRS provider shall offer customers, at no 
cost, the option to lock their accounts to prohibit

[[Page 85815]]

the CMRS provider from processing requests to change the customer's 
SIM. A CMRS provider shall not fulfill a SIM change request until the 
customer deactivates the lock on the account, except if the SIM change 
request was made in connection with a legitimate line separation 
request pursuant to 47 U.S.C. 345 and subpart II of this part, 
regardless of whether the line separation is technically or 
operationally feasible. The process to activate and deactivate an 
account lock must not be unduly burdensome for customers such that it 
effectively inhibits customers from implementing their choice. A CMRS 
provider may activate a SIM change lock on a customer's account when 
the CMRS provider has a reasonable belief that the customer is at high 
risk of fraud, but must provide the customer with clear notification 
that the account lock has been activated with instructions on how the 
customer can deactivate the account lock, and promptly comply with the 
customer's legitimate request to deactivate the account lock.
    (5) Notice of account protection measures. A CMRS provider must 
provide customers with notice, using clear and concise language, of any 
account protection measures the CMRS provider offers, including those 
to prevent SIM swap fraud. A CMRS provider shall make this notice 
easily-accessible through the CMRS provider's website and application.
    (6) Procedures to resolve fraudulent SIM changes. A CMRS provider 
shall, at no cost to customers:
    (i) Maintain a clearly disclosed, transparent, and easy-to-use 
process for customers to report fraudulent SIM changes;
    (ii) Promptly investigate and take reasonable steps within its 
control to remediate fraudulent SIM changes; and
    (iii) Promptly provide customers, upon request, with documentation 
of fraudulent SIM changes involving their accounts.
* * * * *
    (8) SIM change recordkeeping. A CMRS provider shall establish 
processes to reasonably track, and maintain for a minimum of three 
years, the total number of SIM change requests it received, the number 
of successful SIM change requests, the number of failed SIM change 
requests, the number of successful fraudulent SIM change requests, the 
average time to remediate a fraudulent SIM change, the total number of 
complaints received regarding fraudulent SIM change requests, the 
authentication measures the CMRS provider has implemented, and when 
those authentication measures change. A CMRS provider shall provide 
such data and information to the Commission upon request.

[FR Doc. 2023-26338 Filed 12-7-23; 8:45 am]
BILLING CODE 6712-01-P


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